PETALING JAYA: Timber manufacturer Harvest Court Industries Bhd has entered into a non-binding related party transaction (RPT) with 1Green Enviro Sdn Bhd for the construction of a pulp and paper plant in Jempol, Negri Sembilan worth RM70mil to process oil palm empty fruit bunches.

Filings with the stock exchange showed that 1Green Enviro’s directors and shareholders, Datuk Raymond Chan Boon Siew and Mohd Nazifuddin Mohd Najib, respectively held 15.7% and 2.2% stakes in Harvest Court.

The project would consist of three packages for a total targeted capacity of up to 70,000 tonnes, with the letter of intent involving only the first two packages.

Harvest Court said the first package amounting to RM50mil involved providing production facilities for 15,000 tonnes capacity while the second package amounting to RM20mil involved the upgrading of production facilities to 25,000 tonnes capacity with the total size of the plant to be 150,000 sq ft on 10 acres of land.

The company said the third package would involve a separate production line of 45,000-tonne capacity to commence upon completion of the first two packages.

“The gross and net profit margin for the said packages, from the contract amount, is estimated at 15.7% and 11.8%, respectively,” it said, adding that the first package was expected to commence a month after approval was obtained from the company’s shareholders at an EGM to be convened.

The second package would commence in the following year.

The company said the proposed site of the project had been finalised and plans would be submitted to the Jempol district council by the end of the year.

Besides Chan and Nazifuddin, Tan Tiang Lai is the other director in 1Green Enviro, while the shareholders are Paramount Billion Sdn Bhd and Green Patent Technologies Sdn Bhd.

Chan, Nazifuddin and Lim Thiam Huat are the major shareholders of Paramount Billion where they held 60% of the total issued and paid up capital.

Harvest Court last week entered into an RPT with Sagajuta Sdn Bhd worth RM129mil for the design and construction of a proposed mixed development in Sabah.