Burmese JV for Tat Hong

Singapore based international crane group Tat Hong has signed a heads of agreement with Intraco and Aung Moe Kyaw to set up a Singapore based joint venture to sell and rent cranes in Burma /Myanmar.

The non-binding plan is for the joint venture to distribute both cranes and excavators in Burma as well as establishing a wholly-owned crane rental subsidiary within the country.

Tat Hong and Intraco will each hold a 40 percent stake in the new business,
with the balance held by Aung Moe Kyaw. The new venture is expected to have an initial paid-up capital of $3 million. Tat Hong says that its $1.2 million investment will be funded internally.

Intraco is listed on the Singapore stock exchange, almost 30 percent of the shares are owned by certain directors of Tat Hong. The company trades in a range of materials including metals and minerals. It also has a projects division covers large scale lighting installations and the provision of building materials. The company works in China, Vietnam, Cambodia and the Philippines. It has also had a business presence in Burma for the past 25 years.

Aung Moe Kyaw is managing director of International Beverages Trading Company Group, the leading alcoholic beverage producer and distributor in Burma and is an active member of the Union of Myanmar Federation of Chamber of Commerce and Industry and Myanmar Agro-base Food Product Manufacturing Association.

The aim is to complete negotiations and finalise the agreement by September 30th.

Vertikal Comment

Burma or Myanmar is rapidly emerging from almost 50 years of strict military control, during which time growth has been stifled thanks to its isolationist policies over the years. Rapid reforms by the new civilian government are raising the prospects for development and international trade in what is a very rich country in terms of raw materials and resources, with a 60 million population and a land mass greater than that of France.

This is a good move on Tat Hong’s part in that it gains from the expertise of others and yet through the cross shareholdings of its directors the company should have far greater influence than its 40 percent stake suggests. If the new venture does well, we would not be surprised to see it eventually become a wholly owned by Tat Hong.

source: Vertikal
http://www.vertikal.net/en/news/story/17497/