Cement News

Mudajaya buys cement maker Real Jade for RM224 mil to expand into China


KUALA LUMPUR (June 30): Mudajaya Group Bhd is buying Real Jade Ltd, which is involved in the manufacturing and trading of cement and clinker in China, at an indicative price of HK$400 million (about RM224.32 million), to expand its trading and manufacturing of construction materials business in the country.

The construction outfit said in a bourse filing on Thursday (June 30) that its indirect wholly-owned subsidiary Xelmont Ltd had inked a share sale and purchase agreement with Minyi Holdings Ltd for the proposed acquisition of Real Jade, which owns and operates a production plant in Shandong.

Aside from cement and clinker, Real Jade is also involved in the provision of energy conservation and reuse solutions through the installation of energy efficient and environmentally-friendly air-conditioning and heating systems for commercial, residential and industrial buildings, according to Mudajaya.

“We see the growth potential in China, and this expansion into the China market will supplement our local trading and manufacturing of construction materials, as well as expand our market presence overseas,” said Mudajaya group managing director and chief executive officer James Wong.

Mudajaya said the expansion will allow it to expand its revenue stream. “The group is confident that the acquisition will contribute positively to the group’s earnings and growth moving forward,” it added.

Mudajaya said the purchase price for Real Jade represents a discount of 7.1% to Real Jade’s unaudited net assets as at Dec 31, 2021, which amounted to HK$430.498 million.

It plans to fund the purchase via a mix of internal funds and vendor financing.

According to Mudajaya, Real Jade made a profit after tax of HK$164.18 million (RM85.08 million) in FY20, up from HK$22.41 million (RM11.84 million) in FY18, while revenue rose to HK$498.13 (RM258.13 million) from HK$492.22 million (RM259.99 million).  

Shares in Mudajaya closed unchanged at 23 sen on Thursday, giving the group a market capitalisation of RM291.99 million.





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