Malaysian firm in US$1b Ghana housing deal

... Fnancing to be secured by the Ghana government.
Malaysian construction group Sumatec Resources Bhd has teamed up with Sithru (M) Sdn Bhd to undertake a US$1 billion housing development project in Ghana.

The project is to build 60,000 units of mid-range apartments over a period of five years.

Work is to start by the second quarter of 2007.

Sumatec will have a 51 per cent stake in the venture, while Sithru will hold the balance of 49 per cent.

"We are excited about our prospects that will come with this collaboration. The opportunities before us will enhance our earning stream substantially," Sumatec group managing director James Chan said at the joint venture signing ceremony in Kuala Lumpur yesterday,

Also present were Sithru managing director S. Thiruneelakanda, Sumatec chairman Datuk Seri Tengku Ahmad Shah Al Haj, executive chairman Wan Kamaruddin Wan Abdullah, and Ghana High Commissioner to Malaysia Akua Sekyiwa Ahenkora.

Financing will be sourced by the joint venture company and secured by the Ghana government.

Wan Kamaruddin said the project is a stepping stone for Sumatec to tap into Ghana's mining and oil and gas industry in the future.

"This collaboration marks the first step of cooperation between the Government of Ghana and our company. We hope this collaboration will lead to future jobs involving other industries," he said.

Wan Kamaruddin said the group would like to be among the first companies involved in Ghana's oil and gas industry once the Government opens up the sector.

"Ghana's oil and gas era has not yet begun, and it offers great potential to foreign investors. We would like to be there when it happens," he said.

Sumatec's construction order book currently stands at RM400 million, which should last for the next two years.

Last year, 70 per cent of the group's revenue was contributed by its construction division, while the rest was from shipping.

This year, Sumatec is looking at a 20 per cent revenue contribution from its new mining business.