SINGAPORE (May 15): Warehouse and logistics player GKE Corporation has started a China-based joint venture focused on recycling material waste from mining and construction.
The joint venture’s plant will be located at Cenxi City, China, and has a paid-up capital of RMB100 million ($19.9 million). GKE has two other partners in this joint venture, called Cenxi Haoyi Recycling. They are Dongguan Haoyi Industrial Investment and Cenxi City Hengyi Investment.
Cenxi City is providing a 133,334 sqm plot of land into the joint venture in exchange for a 25% stake.
Chen Yong Hua, GKE’s executive chairman, is the majority shareholder of Dongguan Haoyi, which will own 51% of the joint venture. GKE’s subsidiary Wuzhou Xingjian, which operates a ready-mixed concrete plant, holds the remaining 25%.
Neo Cheow Hui, GKE’s CEO, believes that the recycling materials business and GKE’s existing ready-mixed concrete operations will synergy. “The recycled material waste is a feedstock to ready-mix concrete manufacturing,” he explains.
“The Group believes that the broadened business operations to include the material waste recycling plant will contribute positively to environmental sustainability efforts, as well as the Group’s financial performance in the long term,” says Neo.
This May 14 joint venture comes on the back of an expansion plan announced by GKE just a fortnight ago. On May 6, GKE announced plans to raise $7 million to fund a new ready-mix concrete manufacturing plant. It plans to fund this capital expenditure by issuing 100 million new shares at 7 cents each.
GKE shares last traded at 6.9 cents.
