Malaysian conglomerate UMW Group formed a joint venture to supply lubricants, automotive components and service center operations in Indonesia. UMWs manufacturing subsidiary will partner with Blue Bird Group, a leading Indonesian transportation company.
UMW said the alignment is part of its strategies to move up the value chain of its manufacturing and engineering activities and to expand into growing overseas markets.
With this platform, UMW and BBG will be able to explore other potential businesses in Indonesia, UMW President and Chief Executive Officer Datuk Syed Hisham Syed Wazir said in a statement. He noted that the joint venture is UMWs first foray into Indonesia.
Blue Bird Group could provide the joint venture with a large captive lubricants customer. Headquartered in Jakarta, BBG has five core businesses: passenger transportation; logistics services; manufacturing; property; and support services. It manages a fleet of 26,000 taxis.
BBG owns 51 percent of the joint venture, which was not named, and UMW Manufacturing and Engineering the other 49 percent. UMW said the joint venture has an initial cash infusion of U.S. $1 million with authorization for an additional $3 million.
UMW has lubricant blending plants in Malaysia and China and plans to expand the one in Malaysia.