PETALING JAYA: Hartalega Holdings Bhd, through its wholly owned subsidiary Hartalega NSM Sdn Bhd, on Wednesday inked a sale and purchase agreement with Northern Gateway Free Zone Sdn Bhd for the acquisition of 250 acres of land in Bukit Kayu Hitam, Kedah, with an investment of RM7 billion to build 16 manufacturing facilities over the next 20 years.
Concurrently, both parties also signed an option agreement for Hartalega to purchase another 130 acres of land in the same location.
Northern Gateway Free Zone is a wholly owned subsidiary of Northern Gateway Sdn Bhd – a wholly owned entity of Minister of Finance Incorporated and the master developer of the Kota Perdana Special Border Economic Zone (SBEZ).
With endorsement from the government, this will see the group expanding its presence in the northern region over the long term.
The area earmarked for the group’s expansion in Kota Perdana SBEZ is highly conducive to business due to its free industrial and commercial zone status. It also houses an inland port, further facilitating logistics and operations.
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said the investment decision by Hartalega is an endorsement of Kota Perdana SBEZ’s rising status as a new and preferred investment destination.
“Kota Perdana SBEZ is now poised to further enhance its position and reputation in attracting other high-end and export-oriented industries, leveraging on its competitive advantage such as proximity to the Malaysia-Thailand border as well as the Penang Port. This will also drive economic development in Kedah, with a huge, positive impact for the northern region. Most significantly, the project is expected to generate more than 12,000 jobs and help upskill local talent and vendors, while supporting infrastructure development,” he added.
This project aims to unlock value not only for the Kota Perdana SBEZ, but also for the entire region via its economic multiplier effect that is expected to trigger more investments coming to this part of Malaysia.
Hartalega CEO Kuan Mun Leong said going beyond the current Covid-19 situation and taking a long-term perspective towards the structural step-up in global demand, its production capacity must be accelerated.
“Our growth strategy remains focused on Malaysia, given its comprehensive ecosystem and supply chain for the glove sector. This expansion plan will further solidify Malaysia’s positioning as the largest glove manufacturer globally.
“Our aim is to cultivate a robust supply chain as well as upskilling local talents and vendors, to transform the region into an integrated industrial park for medical devices in the future, establishing the region as an attractive destination for both foreign and domestic direct investment. Upon completion, Hartalega estimates to contribute more than 5% of Kedah’s total GDP,” said Kuan.
Currently, Hartalega is the world’s leading nitrile glove manufacturer, producing 43 billion pieces of gloves per year. The group’s expansion plans include the NGC 1.5, which will increase the group’s capacity to 63 billion pieces of gloves per year upon completion.
The longer-term expansion plan in Kedah will add another 80 billion pieces per year, bringing Hartalega’s total capacity to 143 billion pieces of gloves per annum once completed.
