Cropmate Berhad (“Cropmate” or the “Company”), a Malaysian fertiliser manufacturer and supplier, today announced that its indirect wholly-owned subsidiary, Cropmate Fertilizer Bintulu Sdn Bhd, has entered into a conditional sale and purchase agreement (“SPA”) with Dominant Potential Sdn Bhd for the proposed acquisition of approximately 4.0 acres of industrial land in Kidurong Industrial Area Phase II, Bintulu, Sarawak, for a total cash consideration of RM12.0 million.
The proposed acquisition marks a strategic step in Cropmate’s expansion into East Malaysia, where the Group intends to establish a fertiliser manufacturing and warehousing facility to strengthen its operational presence and better serve customers across the region. Subject to obtaining the necessary approvals, the proposed facility will undertake the formulation and blending of conventional and specialty fertilisers, alongside the warehousing of straight fertilisers and related products.
Strategically located near Bintulu Port, the proposed facility is expected to provide logistical advantages by reducing transportation and distribution costs for raw materials and finished products. The establishment of a local manufacturing presence will also enable Cropmate to improve supply efficiency, shorten delivery lead times and enhance its competitiveness in the East Malaysian fertiliser market.
East Malaysia represents a significant growth opportunity for Cropmate, accounting for approximately 55% of Malaysia’s total oil palm planted area, according to the Malaysian Palm Oil Board’s (“MPOB”) 2025 statistics. Based on planted area as a proxy for fertiliser demand, East Malaysia is estimated to account for approximately 55% of the country’s oil palm fertiliser consumption, exceeding Peninsular Malaysia. This sizeable market presents opportunities for Cropmate to replicate its established business model in Peninsular Malaysia by positioning its manufacturing operations closer to customers, improving distribution efficiency and expanding its market penetration across Sabah and Sarawak.[1]
Mr. Lee Chin Yok, Managing Director of Cropmate Berhad, commented “East Malaysia represents an important growth market for Cropmate, supported by its established plantation industry and continued demand for fertiliser products. The proposed acquisition is a significant step towards strengthening our presence in the region and bringing our products closer to customers. By establishing a manufacturing and warehousing facility in Bintulu, we aim to enhance our supply chain efficiency, reduce our reliance on long-distance transportation and respond more effectively to customers’ requirements. The strategic location near Bintulu Port will also provide us with greater flexibility in managing raw material procurement and product distribution.”
He added, “Our fertiliser products, particularly those formulated for oil palm cultivation and our range of specialty fertilisers, have established a strong presence in Peninsular Malaysia. As we expand into East Malaysia, we are entering a market where we can leverage our proven product offerings and technical expertise to better support customers’ fertilisation needs. By bringing our manufacturing operations closer to customers, we aim to replicate our success in Peninsular Malaysia while providing more responsive technical support and strengthening our market presence across Sabah and Sarawak.”
The proposed acquisition will be funded through a combination of internally generated funds and bank borrowings. The purchase consideration of RM12.0 million was determined on a willing-buyer willing-seller basis, taking into consideration an independent valuation of the land at RM12.0 million as at 16 July 2026.
The acquisition is conditional upon obtaining the necessary consent from the Director of Lands and Surveys for the transfer of the land. Barring unforeseen circumstances, the proposed acquisition is expected to be completed by the fourth quarter of 2027.
While the proposed acquisition is not expected to have any material immediate effect on the Group’s earnings and earnings per share for the financial year ending 31 December 2026, the Board believes that the expansion will contribute positively to Cropmate’s long-term earnings potential.
[1] Source: Malaysian Palm Oil Board (MPOB), Oil Palm Planted Area 2025. Estimated regional oil palm fertiliser consumption shares are derived from the distribution of oil palm planted areas and do not represent actual recorded fertiliser consumption.
