The two parties signed a Memorandum of Understanding (MoU) to provide total maritime logistic solutions, such as container liner, bulk cargoes, tug and barge, self-propelled barge, oil and gas support vessels coupled with other related services such as vessel chartering, pooling management, shipping consultancy and crew management, the company said in a stock market announcement.
“Our focus is to expand our footprint regionally, partnering with a reputable maritime industry leader, who shares the same vision to take advantage of the growing trade in Asean. PDZ has been waiting for a long time to penetrate into the Indonesia shipping market,” said ceo and ed Christopher Tan Chor How.
Indonesia is currently amongst the largest exporters and has some of the biggest deposits of some key commodities/minerals including crude palm oil, coal, tin, nickel and bauxite and moving into the market is in line with the PDZ’s regional expansion plans. The archipelagic nation is the world’s top crude palm oil exporter and second largest coal exporter and tin producer.
In terms of freight, Indonesian seafreight is projected to reach $25bn by 2020 with container volume of over 50m teu, according to the Indonesian National Shipowners’ Association (INSA).
The growing Indonesian manufacturing and increasing production and processing of mineral resources bodes well for rising export demand, while imports continue to benefit from its vibrant consumer spending, further supported by construction of new ports to support the growing demands of the industry, all of which lead to rising demand for maritime logistic solutions on the back of growing global economy and international trade, PDZ said.
Noting that Indonesian regulations on foreign investment and its cabotage policy require partnership with local players, Tan noted: “This partnership with the reputable IBC Group opens up PDZ’s expansion into the Indonesian market and is expected to contribute positively to PDZ’s profitability with its favourable tax regimes and government initiatives.”
“Negotiations are on-going with IBC Group, to participate in the container liner business in Indonesia, coupled with dry bulk transportation deals, as Indonesia offers tremendous potential growth for sea transportation as it is located among some of the world’s busiest sea lanes, whose economies, Asean in particular, is buoyed by strong freight demand as the region plays an increasingly important role in global maritime transportation, all of which is expected to contribute positively to PDZ’s profits,” said Tan.
PDZ said it is also undertaking a cash call exercise, via a rights issue with free warrants, to raise up to MYR43m ($10.7m) to support its regional business for acquisition of vessels, container tug and barge, dry docking expenditure, containers, security deposits, acquisition/investment into other complementary businesses/assets and working capital.
“With these strong business sentiments worldwide, we at PDZ believe that 2018 is the best time to expand our services,” concluded Tan.
