Genting Plantation Berhad
Genting Plantations Berhad (“Genting Plantations”), formerly known as Asiatic Development Berhad, is one of the fastest growing plantation companies listed on the Main Board of Bursa Malaysia (formerly known as Kuala Lumpur Stock Exchange). Incorporated in Malaysia as a private limited company on 29 September 1977, under the name of Asiatic Development Sdn Bhd, it became a wholly owned subsidiary of Genting Berhad (“Genting”) on 22 February 1980 to spearhead Genting’s plantation business.
Listed on Bursa Malaysia on 30 August 1982, Genting Plantations currently ranks amongst the top 10 listed companies in terms of market capitalisation in the plantation sector. As at 30 April 2009, Genting Plantations is a 54. 7% owned subsidiary of Genting Berhad. In April 1980, Genting Plantations commenced business through the successful acquisition of the Rubber Trust Group comprising 3 Hong Kong domiciled rubber companies which owned some 13,700 hectares of plantation land in Peninsular Malaysia.
In June 1981, the Ko Rubber Companies, which owned about 10,000 hectares of plantation land in Peninsular Malaysia, were acquired by Genting Group and through a restructuring exercise in 1983, some 9,268 hectares of these plantation land and businesses were transferred to Genting Plantations. In the same year, Genting Plantations acquired a further 676 hectares of oil palm plantation and a 30 tonne per hour oil mill.
These acquisitions would have now proven to be most astute decisions judging by the development potential of some of the land and the capital appreciation that has since taken place, particularly the 3,200 hectare – Genting Kulai Besar Estate which is now being developed as the mega Genting Indahpura project in Kulai, Johor. Recognising the scarcity of land in Peninsular Malaysia, Genting Group started making inroads into Sabah. In 1985, Genting Group acquired Asiatic SDC Sdn Bhd, whose plantation business comprised some 4,000 hectares of oil palm plantation and a 20 tonnes per hour oil mill.
In a subsequent rationalisation of Genting Group’s plantation activities, ownership of ASDC was transferred to Genting Plantations in 1991. A quick succession of land acquisitions in Sabah ensued for Genting Plantations, starting with the takeover of Tanjung Bahagia Sdn Bhd in 1988 which owns 8,094 hectares of jungle land, followed by a joint venture arrangement with Landworthy Sdn Bhd (now known as Asiatic Tanjung Bahagia Sdn Bhd) in 1989 which added another 4,039 hectares. Between 1991 and 1996, another 5,730 hectares were acquired.
With all these jungle lands fully cultivated, Genting Plantations, with its long term vision to further its plantation interest, continues to expand its land bank. Notable acquisitions include the 8,830-hectare agricultural land near the Sungai Tongod and the 5,611-hectare oil palm estate near Bukit Garam in 2001 and 2002 respectively. And in May 2004, Genting Plantations has completed yet another acquisition of some 6,753 hectares of oil palm estates together with a 60 tonnes per hour oil mill in Kinabatangan, Sabah.
In June 2005, Genting Plantations embarked on its maiden foray into the plantation business overseas. This expansion of plantation activities in the Republic of Indonesia is on a joint venture basis with a respectable palm oil producer in the country, the Sepanjang Group. The Genting Plantations-Sepanjang 70:30 joint venture will develop some 76,000 hectares of agricultural land into oil palm plantation. Genting Plantations entered into another joint venture in 2008 to develop 45,000 hectares in Ketapang.
Following these recent acquisitions, Genting Plantations’s current land bank is slated to increase to over 186,000 hectares in Indonesia and Malaysia; an impressive 14-fold increase since 1980. The Group continues to be actively working towards adding more. At present, Genting Plantations owns 6 oil mills, one in Peninsular Malaysia, which attained the ISO 9002(1994) Quality Management Systems status in 2001 (which was subsequently updated to the ISO 9001(2000) in 2002) and the others in Sabah. Total milling capacity to date is 265 tonnes per hour.
In 1994, Genting Plantations entered into a joint venture with a Sarawak state agency to establish a 30/60 tonnes per hour palm oil mill in Serian, Sarawak. This mill scored a hattrick when it was awarded the Anugerah Industri Sawit Malaysia, in recognition of its high oil extraction rate, by PORLA since its commissioning in August 1997. Whilst plantation business remains the core activity, Genting Plantations has since ventured into property development with the objectives to unlock the potential of its strategically located land bank and to reduce its dependence on single source income.
The first project by Genting Plantations’s property arm, Genting Property Sdn Bhd (“Genting Property”) is the 55-hectare Genting Cheng Perdana in Central Melaka. Officially launched in October 1993, the project has turned out to be quite a success with its first phase of single- and double-storey houses completed and handed over to purchasers about 9 months ahead of schedule.
Since then, 3 other phases have been completed and handed over in good time. What followed next was the launching of the 284-hectare Genting Permaipura project in late 1994. Located about 10 km from the fast-growing town of Sungai Petani, Kedah, a town poised to become the commercial/industrial hub of the northern region in Malaysia, Genting Permaipura comprises commercial and entertainment centres, bungalow lots, residential houses and shop-offices.
Also included in this project is an 18-hole golf course with a 2-tier driving range which sprawls over 160 acres of prime land against the majestic backdrop of Gunung Jerai and a clubhouse, The Genting Permaipura Golf & Country Club. Further, in its push to the forefront of property development, Genting Property had embarked on another project – the massive Genting Indahpura or “Beautiful City” project at Kulai, Johor.
Spanning over 30 years, this project located just 30 km north from the bustling and fast growing city of Johor Bahru involves the development of about 3,200 hectares of plantation land in Kulai, Johor, into a self-contained township. Genting Indahpura is conceptualised as a fully-integrated development complementing the State’s plan to upgrade the existing Kulai town into a sub-regional centre complete with all modern amenities and convenience, and generously landscaped town parks and green lungs for healthy and recreational pursuits.
The project’s attraction lies in its excellent location which enjoys easy access from virtually every transportation route – road linkages through the North-South Expressway and the Second Link from Singapore; air linkages through the Sultan Ismail International airport in Senai 10 minutes away; and rail links through the Federal Railway lines. Genting Plantations also has other large tracts of land with development potential.
These will continuously be monitored as to the timing and the type of development most suited in relation to their locations. With low land holding cost and huge reserves of own land bank, Genting Plantations can aspire to play a bigger role in the property sector in Malaysia in the near future. Moving forward, the Group, through its wholly owned subsidiary, Asiatic Centre for Genome Technology Sdn Bhd (“ACGT”), has ventured into the biotechnology industry in 2006.
ACGT has set up an equally owned joint venture with Synthetic Genomics Inc “Synthetic Genomics”), a privately held company dedicated to commercializing synthetic genomic processes and naturally occurring processes for alternative energy resources. The joint venture is tasked to carry out research and development activities on the use of genomics-based techniques and tools to increase the yield and profit stream from crop plants. It will initially focus on whole genome sequencing of oil palm.
Synthetic Genomics, which was founded by genome pioneer J Craig Venter, Ph. D. will use its expertise in DNA sequencing to enable SGSI-Asiatic Limited to develop a comprehensive genomic study of oil palm whilst ACGT will be the exclusive agent and sole licensee, on a worldwide basis, for commercialising the technologies developed. In May 2008, the joint venture announced that it had successfully completed the first draft assembly of the oil palm genome. For more information, please visit www. acgt. asia. Genting Plantations is actively involved in environmental conservation and committed to sustainable development of oil palm cultivation.
Since 1999, Genting Plantations has collaborated with World Wide Fund for Nature (“WWF”) in support of its “Partners for Wetlands”) programme to conserve the Kinabatangan floorplains aimed at rehabilitating and restoring riverine and wetland habitats as wildlife sanctuary and preservation of biodiversity. The Kinabatangan floorplains will serve as a corridor for wildlife movement of Borneo flagship species, such as pygmy elephant, orang utan and proboscis monkey. The Group, noted as the first plantation company to participate in the programme, has extended its partnership with WWF for another 15 years from 2006.
On the international front, the Group is one of the first 14 members of the Roundtable of Sustainable Palm Oil (“RSPO”), a multi-stakeholder association, whose primary objective is to promote the production and use of sustainable palm oil through co-operation within the supply chain and open dialogue with its stakeholders. Genting Plantations will continue to pursue and adopt good plantation management practices to uphold the well being of the environment it operates in.