29/04/2014 (tce today) - Malaysian conglomerate Sime Darby has taken a stake in US biotechnology firm Verdezyne, as it seeks to add value to palm oil.

Sime Darby CEO Dato’ Mohd Bakke Salleh says that the investment in Verdezyne is part of his company’s initiative to build a portfolio of palm-related industrial biotechnologies, to add value to its palm plantation assets and lead to future growth of the company. The initiative will be led by Sime Darby Renewables, a new unit of Sime Darby Plantation.

California-based Verdezyne’s proprietary process uses specially-developed strains to turn renewable feedstocks into high-value chemicals that are usually made from petroleum. These include dodecanoic acid, sebacic acid and adipic acid, which are variously used in the production of nylon, adhesives, resins, coatings and lubricants. The investment from Sime Darby will accelerate the development of the technology and create new job opportunities.

Verdezyne has chosen Malaysia as its manufacturing hub, and as such in September 2013 attained BioNexus status in the country. BioNexus status – awarded to value-adding biotechnology companies in Malaysia which meet strict eligibility criteria – gives companies access to financial incentives such as tax exemptions and grants.

Datuk Franki Anthony Dass, Sime Darby Plantation’s managing director, says that the deal “will not only build a portfolio of palm-related industrial biotechnology companies but also strategically integrate these with our business activities. Our competitive edge is the availability of sustainable palm-based feedstocks in our plantation value chain.”