KOTA KINABALU: About 1,500 Sipitang folks working in Sabah Forest Industries Sdn Bhd (SFI), can now heave a sigh of relief following the success of a business take-over exercise that has enabled them to keep their jobs.

Under this arrangement, a new company Pelangi Prestasi Sdn. Bhd. will take over the business of SFI, which entails the transfer of all assets, land titles and timber licences. The company will in turn, retain the existing workforce of SFI and has given their commitment to undertake the back-wages of existing employees currently under the temporary layoff scheme.
In addition, the new owner will also look into the welfare of the employees which includes providing support and training, enhancing access to basic amenities (electricity and water supply) and providing support to local schools to ensure that children receive education in better environment.
The completion of this takeover exercise, involving a price-tag of RM1.2 billion is targeted to be completed by the end of 2018. This exercise will not only save jobs, but is also expected to contribute further to the local socio-economic development via creation of more employment opportunities and other economic spill-over effects.
The takeover is made possible by strong support of the Sabah State Government, which has been proactive in resolving the issue by looking for suitable investors to take over the business of SFI, previously owned by India-based Ballarpur Industries Ltd.
The announcement was made by the Sabah Chief Minister Tan Sri Datuk Seri Panglima Haji Musa Bin Haji Aman at an event organised by Yayasan Sabah at the Esplanade, Sipitang this morning. He said this move is seen as a good example of smart government-private sector partnership that would bring mutual benefits to all parties involved, particularly the community in Sipitang.
Following a debt repayment exercise, SFI, Malaysia’s largest integrated pulp and paper manufacturer, had ceased operations early this year, leaving close to 1,500 of its employees, who are mainly locals, in financial limbo as they had to undergo a temporary layoff scheme and take a 50 per cent pay cut since January 2018.
”To the people of Sipitang, SFI is not just another company operating in the area but also serves as the economic back-bone to the community there, where its closure could certainly have an adverse effect on the livelihood of the people,” said Musa.
The completion of this take-over exercise would not only safeguard the financial security of the local community, but is also expected to further boost the socio-economic development in Sipitang via the many business expansion plans the new company has in store, going forward.
Upon completion of the takeover, the new owner plans to restore SFI operations, initially looking into the possibility of restarting the pulp and paper mill operations. Over the next five years, the new business which will be anchored by sustainable development of the forest concession area, intends to maximise value through integrated processing and diversification of products. This includes, the production of various timber products using existing facilities, establishing a new Bio-Hub using waste residues from forestry and other agricultural plantations, developing the existing jetty into an integrated Bio-Port – a modern port that is able to handle large vessels as well as developing an Eco-Tropical Resort.
The plans the new business has in store are strategic investments that would serve as a catalyst to significantly boost the economic activity in the area, potentially creating more than 3000 employment opportunities in the next 5 years.
This venture is expected to generate an economic spill over worth more than RM6 billion and the benefits derived from this would not only be enjoyed by the Sipitang folks but the entire rakyat of Sabah as well. -pr/BNN 

Source: https://borneonews.net/2018/05/07/take-over-to-create-potential-economic-value-of-rm6-billion-for-sipitang/