KUALA LUMPUR: PGF Capital Bhd subsidiary, NetZero Technology Sdn Bhd, has inked a sales and purchase agreement to acquire a land worth RM40 million in Kedah to expand its insulation manufacturing plant.
The freehold land acquired from Senam Jaya Sdn Bhd measuring about 23.9 acres in Kulim in a development to be known as Kulim East Industrial Park.
In a statement today, PGF Capital said the land will be developed in phases.
Under the Phase 1, a new manufacturing plant will be built to increase the total annual insulation production capacity by 160 per cent or 40,000 metric tonne (mt) from the existing 25,000 mt to 65,000 mt.
Construction of the new plant is slated to commence early next year, with commercial operations expected to begin by first half of 2026.
Meanwhile, Phase 2 will add another 20,000 mt of capacity, bringing the total to 85,000 mt, with completion anticipated by first half of 2028.
The land is strategically located about 30 minutes from PGF Capital's existing Perai manufacturing facility and 45 minutes from Penang Port, offering logistical advantages for the Group.
The acquisition, to be financed through a combination of internal funds and bank borrowings, is projected to complete within four calendar months from the date of the agreement.
Executive director and group chief executive officer Fong Wern Shen said the land is sufficient to cater to the expansion needs for the next five years.
"We are building additional annual capacity of 40,000 mt to meet the growing demand driven by the global trend towards sustainability and energy efficiency. "The increased focus on net zero targets presents significant opportunities for PGF Capital, as insulation plays a crucial role in reducing energy consumption and carbon emissions," he said.
Fong added that the planned expansion will also position the company well to capture opportunities in other regions as demand for energy-efficient building solutions increases.
"The group is exploring the possibility to jointly establish a local manufacturing facility with Centria International to produce insulated panels with both glass wool and stone wool cores," he said.