From left: Tex Cycle group chief financial officer Geraldine Hill Siaw Wei, Tex Cycle executive director Lee Hai Peng, Tex Cycle executive chairman Datuk Keh Chuan Seng, Tex Cycle group CEO Gary Dass Anthony Francis, Econas Resource to Energy director Kasrul Nazrin, Econas Resource to Energy executive chairman Datuk Mohd Shafiee Mohd Sanip, and Malaysian Green Technology Corporation director Datuk Leong Kin Mun.
KLANG: Tex Cycle Technology (M) Bhd
, which has been on an aggressive expansion mode since its new major shareholders emerged in May last year, is not slowing down.
The waste management and recycling solutions provider is hoping to acquire a few more companies within the waste management space by year-end.
“There are more mergers and acquisitions (M&As) in the pipeline. There will be a couple more this year and next year and we are looking at organic growth and M&A too.
“The fastest way to grow is to tie up with peers with different expertise,” said Tex Cycle group chief executive officer Gary Dass Anthony Francis at the sidelines of a signing ceremony of a collaboration agreement between Tex Cycle and Econas Resource to Energy Sdn Bhd (ER2E).
“That is why we have been selling all our other properties, keeping the cash for expansion and M&As."
He explained that the company would enjoy full year contributions from its acquired companies starting as early as FY24.
Tex Cycle saw the emergence of Keh Chuan Seng and Lee Hai Peng as substantial shareholders in early May last year.
Keh became as the single largest shareholder of Tex Cycle on May 2 after acquiring 67 million shares, or an indirect stake of 26.43%, while Lee acquired 13 million shares, or a direct stake of 5.13%.
In June, Tex Cycle proposed to acquire Meridian World Sdn Bhd, which specialises in wastewater and air pollution control, for RM55mil cash.
Two months earlier, it announced a partnership with Evolusi Bersatu Sdn Bhd to invest RM100mil in Sabah’s first integrated scheduled waste management facility.
Tex Cycle is said to hold a 51% in this joint venture with Evolusi.
Under the collaboration agreement with ER2E, Gary Dass said Tex Cycle will be able to leverage ER2E’s end-of-life waste disposal facilities, namely the secured landfill and incineration plant, to extend the range of waste management services to customers.
Tex Cycle will utilise its established market presence to support ER2E in promoting and expanding its waste management operations under this collaboration.
Gary Dass said Tex Cycle can secure up to 5,000 tonnes of scheduled waste management works per month for ER2E, ensuring first priority for disposal and processing at ER2E’ facilities. The collaboration is slated to kick start by the fourth quarter of this year.
“We are targeting to get at least 5,000 tonnes a month. We have 31 waste codes under our licence and Econas has 68. There is a huge potential to grow especially where we can secure more waste from the market,” he elaborated.
Tex Cycle will also provide technical support and act as a third-party transporter, enhancing ER2E’s operational efficiency.
Under the collaboration, ER2E will engage Tex Cycle for similar volumes in waste recycling and recovery projects, granting them priority to undertake and manage these projects.
“We believe this collaboration will not only enhance our market presence but also significantly contribute to a more sustainable future with our core waste management processes as well as boost our revenue significantly,” Gary Dass said.
When asked if Tex Cycle had plans to acquire Econas, Gary Dass said: “The size of Econas is big, the valuation is also huge.
“So, I don’t think we can swallow so much. We also need to build up our profile through these kinds of joint ventures and see if there is a possibility (of a M&A). For now, it is purely collaboration.
“The main thing now is to build our bottom line, revenue and make it bigger. Even through our acquisitions,” he added.
