Indonesian billionaire Sukanto Tanoto is planning to invest 11 billion yuan (US$1.5 billion) to build a lyocell fibre plant in eastern Shandong province, raising his bets on China soon after a US$3.3 billion takeover of tissue-paper manufacturer Vinda International.
His flagship company Royal Golden Eagle (RGE) signed an agreement with Shandong Jining People’s Government to invest in the facility in Jining city with an annual production capacity of 600,000 tonnes, the Dazhong Daily reported on its website on Monday. RGE is optimistic about Shandong’s growth prospects, it added.
Lyocell is a non-toxic, biodegradable semi-synthetic fibre that can be used in paper or textile manufacturing. An RGE spokesman based in Singapore confirmed the investment when contacted by the Post.
RGE is a resource-based natural fibres and edible oil manufacturer with more than US$35 billion in assets, according to its website, with operations in Indonesia, China, Brazil, Spain, and Canada.
The 74-year-old founder, whose family migrated from southeastern Fujian province, will be deepening his business ties in China, especially in the paper industry. The group established a plant in Rizhao city in 2005 to manufacture paper, and started producing lyocell in 2020 with a 20,000-tonne annual capacity.
Indonesian tycoon Tanoto offers to buy tissue maker Vinda for US$3.3 billion
Earlier this month, RGE completed the privatisation of Vinda, whose shares are set to be delisted in August. Tanoto paid HK$26.1 billion (US$3.3 billion) to buy 92.3 per cent of Vinda from other shareholders. RGE raised a 15 billion yuan syndicated loan to fund the acquisition.
Vinda’s net profit plunged 64 per cent to HK$253 million in 2023 from the previous year due to cost inflation and heightened competition, the company said in a stock exchange filing in January.
