Kuala Lumpur, September 24, 2001 (The Star) - IOI Group Bhd’s strategy inexpanding its manufacturing business locally and worldwide lies inaggressive marketing to win not only existing customers but also new ones.According to IOI Bhd’s executive director Lee Yeow Chor, the group hasestablished major selling points worldwide to promote its palm oilproducts.“We have set up certain strategic ports in Europe and maintained the brandname Acidchem which is widely known,” said Yeow Chor referring to theoleochemical industry.IOI bought a strategic stake in Palmco Holdings Bhd in March 1997. Palmco,which is the target of a takeover bid by diversified group Sime Darby Bhd,has posted strong results for the year ended June 30, 2001.Its pre-tax profit jumped 62% to RM88.65mil from RM54.45mil previously.Its core oleochemical operations, including its 30% associate FattyChemical (M) Sdn Bhd, has contributed about RM131mil or 93% to the group’searnings.“Many of the oleochemical products are substitutes for petrochemicals.Palm oil is the most attractive substitute and as Malaysia is the largestworld palm oil producer, the oleochemical share (in the palm oil industry)is very important,” said Yeow Chor in an interview in Puchong recently.Malaysia, he contends, has a crucial role to play in the oleochemicalindustry, since the products are widely used in many countries.When CPO prices drifted downwards last year, earnings from theoleochemical sector helped cushioned the negative impact to thebottomlines.Oleochemicals are used in a wide range of products such as cosmetics,perfume and detergents that are necessary for modern living.Such strong earnings potential from the oleochemical industry promptedconglomerate Sime Darby Bhd to make takeover bid on Palmco Holdings whichSime said represented a good synergy with its plantation business.According to an IOI statement, the company intends to retain the listedstatus of Palmco. The deadline for the shareholders’ acceptances isexpected to be on Oct 10.At the end of the day, one institutional investor said the oleochemicalindustry was regaining its brilliance and that the Sime-IOI episode servesas a wake-up call to investors and market players on the tremendouspotential of the oleochemical industry.