DXN to tap China market
DXN Holdings Bhd is positioning itself to tap the Chinese market for cordycep mushrooms and establish a cordycep tablet manufacturing plant and two distribution centres in China.
Executive chairman and chief executive officer Dr Lim Siow Jin told reporters after the company’s AGM that the group planned to set up the manufacturing facility either in Qing Hai or Guangzhou.
He said the company was currently in negotiations with potential partners and hoped to finalise plans and be ready for operations before the year end when the Chinese government passed new multi-level marketing laws in the first quarter of 2005.
“The Qing Hai provincial government is willing to give us tax incentives for 11 years should we establish manufacturing operations there.
“Qing Hai is one of the four key centres for cordycep mushroom production in China after Sichuan, Yunnan, and Tibet,” he said.
About RM5mil would be allocated as investment in setting up the manufacturing operations, he added.
“We are working out an investment strategy which will help us to save on pouring too much into hardware.
“We will also set aside RM3mil to establish two multi-level marketing distribution centres for cordycep mushrooms in Shanghai and Guangzhou,” he added.
Lim said the group was also looking for land in Kedah, Perlis, and Pahang for the expansion of its spirulina blue-green algae cultivation business.
Last year, spirulina sales contributed 2% to group revenue, which it hoped to increase to 5%, he said.
Lim said in the pipeline were plans to set up multi-level marketing distribution centres in Sudan and UAE by the end of 2004 to tap the North African and Middle Eastern markets respectively.
Read more at http://www.thestar.com.my/business/business-news/2004/08/19/dxn-to-tap-china-market/#28XCAev0Z5HERU3P.99