PETALING JAYA: Fintec Glove Sdn Bhd, a wholly owned subsidiary of Fintec Global Bhd, has commissioned AE Multi Industries Sdn Bhd and its partner Ripcol Engineering Sdn Bhd for the design, procurement, construction of its glove manufacturing venture with projected gross development value of RM160 million.
The group has acquired land in Chemor, Perak, where its 14 glove double former dipping lines production facility wil;l be situated next to AT Systemization Bhd’s.
In April, Fintec took a 13.8% stake in AT Systemization. In November, AT Systemization became a manufacturer of medical gloves with an annual production capacity of 1.87 billion pieces of medical gloves.
“Through establishing a strategic partnership with AT, the synergies provided from the combined manufacturing plant will enable Fintec Glove to unlock shareholder value through the following channels: expedited construction process, shortening Fintec’s production lead time and cost savings of RM10 million over eight years due to Fintec Glove’s close proximity to AT Systemization’s manufacturing site that will enable both parties to share resources and improve efficiencies,” Fintec said in a Bursa filing.
The construction of 14 glove double former dipping lines is expected to begin this month and production will begin in June 2021.
With 14 glove dipping lines operational, Fintec Glove’s manufacturing capacity is projected to exceed 3.3 billion pieces of medical gloves, equivalent to 32,000 pieces every hour.
Fintec Glove expects to recuperate its capital cost within three years, assuming the average selling price of each piece of glove remains above 20 sen.
At present, Fintec Glove is seeing strong interest from multiple parties to signed long term contracts committing to the future delivery of medical gloves.
“The gloves business is anticipated to contribute 25% or more of the net assets or net profits of the group,” according to Fintec’s stock exchange filing.
