CRRC UT, STO EXPRESS AND IREKA ESTABLISH FORMAL WORKING RELATIONSHIP FOR FUTURE DEVELOPMENTS
KUALA LUMPUR, 24 January 2018 – Ireka Corporation Berhad (“Ireka”), CRRC Urban Traffic Co Ltd (CRRC UT) and STO Express Co Ltd (STO) today signed a Memorandum of Understanding (“MOU”) to establish collaborative working between them.
CRRC UT is a member of the China based CRRC Group and is the world’s largest manufacturer of rolling stock, rail and transportation related products and systems. On December 4, 2017, CRRC UT also took up a strategic stake in Ireka, emerging as a substantial shareholder, holding approximately an 8.48% equity interest in the Company. At the same time a complementary MOU was signed with Ireka to exclusively pursue, among others, urban transportation and logistics business areas.
STO is China’s largest integrated logistics services company, focusing on express delivery of courier items.
The MOU signed today between Ireka, CRRC UT and STO establishes a formal and exclusive working relationship to cover the Logistics business area focusing on:
- Investment and development of logistics warehouses, distribution centres and other ancillary real estate facilities to support STO’s business expansion in Malaysia and South East Asia; and
- Investment and supply of infrastructure and equipment including logistics, commercial and special purpose vehicles to support STO’s business expansion in Malaysia and South East Asia.
STO has vast experience of supporting the exponential growth of e-commerce business in China over the last decade. STO’s expansion to the fast-growing South East Asia region is part of its continual growth plans in international markets. In March 2017, Malaysia launched its Digital Free Trade Zone (DFTZ), (the world’s first outside of China) where it will support internet companies to trade goods, provide services and co-create solutions. It is also anticipated to create 60,000 jobs in the country by 2025. Ireka and CRRC UT will be STO’s exclusive partner in developing a strong support infrastructure for STO’s operations, both in terms of real estate, as well as in logistics and transport vehicles.
For CRRC, a giant in the world’s railway transportation industry, they already have a presence in Malaysia and is an active player in the country’s rail industry through its supply of contracts for the LRT System, Express Rail Link and KTM Komuter. In its collaboration with Ireka, CRRC UT will be bringing the best of China’s green urban transportation technology to Malaysia to improve the latter’s urban traffic. This includes super-capacitor powered electric buses and the Autonomous-Rail Rapid Transit (ART) vehicles. The ART is a first of its kind people-mover that integrates the best of a conventional tram technology with that of a leading edge rail-less and autonomous driving technologies (see pictures). ART, already in operation in Zhuzhou, Hunan Province, China, and soon in other parts of China will also hopefully be on the roads of Malaysia in the near future. The partnership with CRRC UT will see Ireka venturing into a new business direction of urban transportation which is in line with Malaysia’s Economic Transformation Programme, to upgrade the country’s public transportation and infrastructure system.
The partnership of Ireka, CRRC UT and STO will create a strong strategic alliance that provides an important platform for this tri-partite relationship to leverage on each other’s technical knowledge, expertise and experience for expansion and growth in Malaysia and South East Asia.
Commenting on the partnership, Ireka’s Group Managing Director, Datuk Lai Voon Hon said, “Ireka has a good track record of delivering what we have agreed to do and also in diversifying our operations. Over the last 50 years, we have successfully diversified and expanded from being in construction, to property development to real estate and to information technology. We are excited about diversifying into urban traffic solutions and rail infrastructure related projects; as well as into the world of logistics. I know that Ireka is ideally positioned to take on this new challenge because of our long track record and I am delighted that both CRRC and STO have selected us as a trusted partner to grow their presence in Malaysia and South East Asia.”