FITTERS Diversified Bhd, the country’s biggest fire-fighting specialist by sales, has started construction work on its maiden biomass power plant in eastern China, its group managing director Datuk Richard Wong Swee Yee said.

The project is worth some RM105 million. FITTERS will build and operate the plant for the Liangshan county in Shangdong province.

“We started the first phase works just recently and it is an exciting time for us, providing us a footprint in the growing renewable energy sector,” Wong said in an interview with Business Times at his office in Kuala Lumpur.

Owners of biomass plants can claim carbon credits, which can be sold for income. This makes such projects economically profitable.

FITTERS is undertaking the project through its 51 per cent-owned unit, Future NRG Sdn Bhd, which had secured the concession.

Wong is also considering an early exercise of a bonus issue to reward its 2,500-odd shareholders.

Last month, stock market regulators approved a proposal for a bonus issue of up to 72.13 million new shares of 50 sen each on the basis of one bonus share for every two existing shares.

This comes just a year after FITTERS gave its shareholders a stock dividend to the tune of one free treasury share for every 20 shares held.

“Under the rules, we have six months to exercise the bonus issue. But we plan to do it sooner rather than later,” said Wong, pointing out that the overall market has been stable.

Early this week, the stock market received an unexpected psychological boost after the China Banking Regulatory Commission said that selected commercial banks from the mainland will be allowed to invest in Malaysia’s capital market.

“Our exposure to China should help us in the long run,” said Wong, adding that, in the immediate term, FITTERS’ game plan was to attract institutional investors.

As at end-April this year, Wong owned 38.18 million shares, or about 26.47 per cent of the company. The rest of the shares in the company are fragmented and held by individual shareholders.

The bonus issue is expected to expand FITTERS’ capital base to 216.4 million shares from its existing capital spread of 144.27 million shares.

“Our appetite for a larger capital base reflects our confidence that, as a business, we are primed for growth,” said Wong. 
 

The news appeared on Business Times on Saturday, 3 July, 2010. Please click the image below to view the original news.