Toyota Tsusho acquires 20pc stake in sand firm
KUALA LUMPUR: Toyota Tsusho Corp said yesterday it is buying a 20 per cent stake in Terengganu Silica Consortium Sdn Bhd, a silica sand mining and refinement company.
The purchase marks an expansion into the Asia and Oceania mining business and will help boost the Japanese company's capacity.
It already owns stakes in Australian silica sand mining and refinement companies, Toyota Tsusho said on its website.
The company, which is listed on the Tokyo Stock Exchange, trades approximately 550,000 tonnes of silica sand annually, equal to nearly 50 per cent of the Japanese market.
The Toyota Tsusho purchase is seen as a landmark deal, as it is the first silica sand mining investment by a Japanese company in Malaysia.
In addition to Japanese customers, silica sand from the Malaysian mine is expected be supplied to Taiwanese, South Korean, and other Asian and Oceanian customers.
Combined with its current business, Toyota Tsusho's silica sand trading volume in Asia and Oceania will expand to nearly two million tonnes annually. The Asia and Oceania market is estimated at five million tonnes annually.
Silica sand is used as a raw material for manufacturing a wide range of industrial goods, from glass and moulds, cast metal, semiconductors and walling.
Demand in Japan, Taiwan, South Korea, and Southeast Asian nations has shown stable growth.
Securing a third mining resource in Malaysia to supplement the existing production at its two Australian companies will ensure that Toyota Tsusho can continue the stable supply of this important raw material and expand sales, the company said.
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