KUCHING: Supreme Consolidated Resources Bhd
plans to invest RM13mil in a new warehousing and cold storage facility for the expansion of its food and beverage (F&B) business, says chairman Datuk Ibrahim Baki.
He said the group is in the midst of identifying a suitable industrial land in Demak Laut Industrial Park for the new facility with a built-up area of 2,000 sq m.
“Our current warehousing and cold storage facility is operating at almost full capacity, resulting in the need to rent additional storage space to store the products, which increases our expenses and reduce operational efficiency,” he said.
The new facility will include a warehousing area, cold storage facilities such as freezer and chiller room to store frozen and chilled food; office, loading and unloading bay as well as a fully-equipped kitchen, which will be used for marketing activities such as cooking demonstrations for its customers.
Ibrahim said this in a circular to shareholders in relation to Supreme’s proposed transfer to ACE Market from LEAP Market and proposed bonus issue of 240 million new ordinary shares on the basis of two bonus shares for one existing share.
Shareholders will vote on the proposed listing transfer and bonus issue at Supreme’s EGM on Jan 31.
Upon completion of the proposed bonus issue, Ibrahim said the group will undertake a proposed issuance of 70 million shares that is expected to raise RM17.5mil based on an indicative price of 25 sen per share.
Of the 70 million new shares to be issued, 53.75 million will be via private placement to bumiputra investors approved by the Investment, Trade and Industry Ministry, 10.75 million shares to eligible directors and employees and persons who have contributed to the group’ success and 5.5 million shares to the public.
Ibrahim also said the group intends to allocate RM11mil of the proceeds from the new share issuance to fund the construction of the new warehousing and cold storage facility and RM4mil for working capital requirement.
The remaining RM2.5mil will be utilised to pay for the estimated expenses relating to the proposed transfer of listing, which is expected to be completed in the fourth quarter of 2024.
In 2020, Supreme spent about RM13.1mil to build warehousing facilities, comprising a three-storey office-cum-warehouse including cold storage facilities and a fully-equipped kitchen with a built-up area of 3,226 sq m.
As Supreme’s warehousing and distribution facilities are currently in Kuching and Miri, Ibrahim said the group plans to expand its distribution work to other main towns in Sarawak.
“As part of the expansion plan, the group intends to increase the number of distribution network in selected districts in Sarawak for improved distribution efficiency and at the same time reduce dependency on distributors.
“The group is also exploring the possibilities of expanding its distribution network to Sibu and Bintulu.
“The expansion will be achieved via the acquisition of suitable distributors in the two districts or by establishing a distribution network in the said districts,” Ibrahim added.
Supreme has held talks with several entities for the acquisitions of distribution networks in Sibu and Bintulu, he said.
Ibrahim said the group also intends to expand its product range by securing new agency rights.
“This will involve securing rights for local and overseas products that complement the current offerings.
“It will include the sourcing and securing of agency rights for alternative products such as blended butter, which are priced lower than butter, to provide customers with additional choices with different pricing.
“One successful example includes securing the rights to distribute dry F&B products in Sri Aman in southern Sarawak and its surrounding areas, which increases the type of dry F&B products that we currently offer,” Ibrahim added.
