16/1/06 (The Malay Mali)  -  SEJATI Oil Palm Feed Sdn Bhd’s shareholders may sell as much as 50 per cent of the company to raise capital to proceed with a plan to build a fibre feed processing plant, said its managing director and dominant shareholder Zainal Ahmad.

"We have signed a memorandum of understanding with a company in December," said Zainal in an interview with Mail Money.

"We are scheduled to meet them again to iron out the finer details of the share sale plan."

According to Zainal, the sale could generate as much as RM1.5 million in cash, and that the new shareholder will also pump in more money, so that the company can proceed with its expansion plans.

Sejati has a paid-up capital of one million shares, issued at a RM1 par value.

"We currently have a mill in Rompin, Pahang. The money will be useful for us to fully utilise the wastage from the plantation mill, as our plant doesn’t depend on diesel anymore," said Zainal.

He added that the fibre plant would need an investment in the range of RM5 million, and that the company’s attempts to get a bank loan to finance the project has been futile.

"We have approached SME Bank and Bank Pertanian, without much success or feedback from the banks."

Sejati, one of the pioneer companies in the country’s fibre feed processing industry, last year had to halt its plans for the plant due to the high cost of fuel.

That led to a rethink, in which Sejati subsequently decided to use the wastage from palm oil mill as its source of energy to fuel the proposed plant.