Malaysia's Sime to grow non-plantation business
KUALA LUMPUR, May 16 (Reuters) - Malaysian planter Sime Darby (SIME.KL) plans to expand its non-plantation businesses to reduce its dependence on the more cyclical palm oil earnings, The Edge business weekly reported, citing a top company official.
"We want to grow our recurring income," said Ahmad Zubir Murshid, Sime's group chief executive.
An expanded income stream will protect the group's earnings in an economic downturn or if crude palm oil prices fall.
"We are trying to focus on China. Our port business there provides us with recurring income," he said.
The group is currently managing five ports in Jining and Weifang in central China's Shandong province.
Sime, Malaysia's biggest company, lacks downstream activities that would enable it to take advantage of softer commodity prices, while its three other core businesses of property development, car and heavy equipment sales are sensitive to economic conditions.
It recently struck a deal with the Liberian government to develop oil palm and rubber estates in West African nation as land runs out at home and global demand for palm oil surges. [ID:nKLR23483]
Sime is also in the midst of acquiring a fabrication yard in the southern state of Johor through the purchase of energy services firm Ramunia (RAMU.KL). [ID:nKLA008257]
(Reporting by Julie Goh)
