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Diversified blue chip and considered one of Sri Lanka’s
few multinationals Hayleys Group’s Haycarb Ltd., is
further expanding its activated carbon operations
overseas with an investment of US$ 2.2 million (over Rs.
200 million) to acquire a plant in Indonesia.
Haycarb said it has acquired an existing carbon
production facility PT Mapalus Makawanua Charcoal
Industry in Indonesia. The investment has been made in
part through a wholly owned subsidiary and in part
directly by Haycarb Ltd. The Company has also got
exchange control clearance for a total investment of US$
2.2 million.
The venture envisages a production facility with a
minimum of three kilns and would enjoy certain tax
concessions and incentives offered by Indonesia’s
Capital Investment Coordinating Board.
With two production locations in Sri Lanka and one in
Thailand, Haycarb Group currently accounts for 16% of
the annual global activated carbon production of 100,000
tons.
The acquisition in Indonesia is part of Haycarb’s
strategy to counter the impact of charcoal price
escalations in Sri Lanka. In the 2004/5 Annual Report,
the Company said that it was taking steps to establish
two manufacturing units in Indonesia with plans to
increase production by over 10,000 tons per annum within
the next three years.
In its last financial year, Haycarb’s pre-tax profits
increased due to higher selling prices and lower
purchase prices for charcoal in Sri Lanka than in the
previous year. Though the coconut crop rose during the
year, that increase was insufficient to meet the
industry’s needs. This resulted in charcoal being
imported at even higher prices than in the previous
year.
Haycarb’s activated carbon reaches its global customers
through its subsidiaries in Thailand, Australia and UK
as well as through independent exclusive distributors
who add value through further processing according to
clients needs.
Following the announcement of the Indonesian
acquisition, Haycarb’s share price yesterday gained by
Rs. 1.75 to Rs. 46.75 while it hit an intra-day high of
Rs. 47.50 while Hayleys share price rose by one rupee to
close at Rs. 130 after touching a peak of Rs. 132.
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