| || Russian crane deal for Muhibbah unit |
14th December, 2005
MUHIBBAH Engineering (M) Bhd’s crane manufacturing unit, Favelle Favco Bhd (FFB), has struck a deal with Russia’s largest elevator maker to supply lifting equipment worth US$25mil. Release link: http://biz.thestar.com.my
FFB managing director and chief executive officer Mac Chung Hui said the company recently signed a five-year distributorship agreement with Karacharovsky Mechanical Plant (KMZ), which produces both passenger and cargo lifts in Russia.
The agreement, which calls for us to deliver at least five cranes a year, comes with an option to extend it for another five years,” he said after a signing ceremony to formalise the deal in Kuala Lumpur yesterday.
Mac said the KMZ order would help boost FFB’s turnover up to 4% next year. The company has projected its 2005 revenue to be at least RM280mil with 80% coming from overseas, mainly from countries in Asia, North and South America and the Middle East. FFB contributes 30% to the Muhibbah group turnover.
He said although the KMZ deal was small, it gave FFB an opportunity to tap the booming Russian construction industry, particularly the development of Moscow City.
“The Moscow City development is slated to house 80 buildings, including one of the world’s tallest buildings,” he said.
Mac said he was confident that FFB could become a major supplier of cranes to the Moscow City project, because it had products that “nicely fit” the Russian construction industry.
FFB designs, manufactures, markets and services a complete range of cranes for offshore pedestal, building tower, wharf and gantry.
The company became a heavyweight manufacturer after acquiring Kroll Cranes of Denmark, whose range includes the world’s biggest tower cranes used for building Russian nuclear plants.
FFB has four plants worldwide. Its lifting equipment are said to be used for the construction of nine of the 12 tallest buildings in the world. Mac said FFB ventured into Russia three years ago and had so far delivered 12 cranes to two oil companies operating there.
The company was also looking at expanding its market in China and the Middle East, he said. On FFB listing on Bursa Malaysia second board, Mac said the exercise was slated for the middle of next year.