KUALA LUMPUR (Sept 22): Multi-Code Electronics Industries (M) Bhd (MCE) has signed a memorandum of understanding (MoU) with Indonesian-based PT Garuda Multi Investama (GMI) to set up a framework for the consultation and exchange of information and technology.

GMI is a holding company for several automotive components manufacturer in Indonesia.

In a filing with Bursa Malaysia today, MCE said the collaboration shall focus on the development, production, marketing and supply of MCE's existing range of products for automobile manufacturers in Indonesia.

But if so desired and mutually agreed by both parties, it can be extended to include other electronic and mechatronic parts and systems.

MCE said it shall develop, provide technical support and information, and provide assembly methodologies and quality control for the products, while GMI shall assemble, market and supply the products of MCE in Indonesia.

"This MoU will enable MCE to further penetrate the Indonesian market, consistent with its strategy to increase its presence in the ASEAN region.

"MCE and GMI will be able to rationalise the cost effectiveness in the manufacture and supply of products and improve on overall competitiveness for the Indonesian market," it added.

Both parties shall do their best to source for business opportunities and to check and confirm the viability of the collaboration between them.

"Upon the confirmation of business opportunities and viability of the collaboration, both parties shall enter into a definitive agreement to set forth more specifically their terms of collaboration," it said.

It also pointed out that the costs and expenses will be negotiated to the mutual acceptance of both parties.

MCE said the MoU will not have any material effect on the issued and paid up capital, net assets and earnings of the company for the financial year ending July 31, 2016.

The MoU is not subject to the approval of shareholders and regulatory government authorities, it added.

MCE was not traded today. It was last traded at 92 sen for a market capitalisation of RM40.85 million.

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