RFM ties up with Iglo of Malaysia on P700-M refrigeration project

Food and beverage conglomerate RFM Corp. has entered into a joint venture with Iglo of Malaysia for the establishment of a P700-million fully integrated, temperature controlled supply chain business that will enable Philippine food growers and processors to maintain the quality of their products from the pick-up point to delivery nationwide and throughout the region.

Iglo Sdn Bhd is the exclusive cold chain service provider of Unilever Walls in Malaysia, Singapore and Thailand, along with other global customers. Iglo is a member of the Hai San Group, a publicly listed Malaysian company that has extensive experience in this field.

The joint venture shall be on a 50:50 basis between RFM and Iglo. The project cost for Phase 1 and 2 is P700 million. Signing the agreement were Raul Martinez for Philtown and Raymond de Graaf for Iglo.

Development for the project is expected to start this month and will be ready for turnover by September this year.

Through its wholly-owned real estate subsidiary Philippine Townships, Inc., the Concepcion-owned conglomerate said the decision to enter into a cold chain joint venture is an offshoot of its review of potential businesses that will support its core business of branded beverage and food products.

RFM officials explained that the new business will take advantage of the implementation of the ASEAN Free Trade Agreement (AFTA) whereby tariffs and trade barrier between ASEAN nations will be significantly reduced if not eliminated by 2002.

It is expected that once the joint venture operation starts, it can be integrated with Malaysia, Singapore and Thailand operations thereby providing a seamless delivery of temperature controlled supply chain services.

"This will greatly benefit not only Philippine growers and food processors, but also their ASEAN counterparts who stand to benefit from AFTA," officials said.

The joint venture will be the first to integrate the complete cold chain process — from upstream to downstream. It will provide the infrastructure that will allow the products to travel from the producer to the consumer in an unbroken cold chain. This makes coordination much easier and better ensures on time delivery.

The design of the cold storage facility and the construction of the whole building will be the first of its kind in the region. It will be the largest cold storage facility in the Philippines with a capacity of 10,000 pellets.

The computerized steering system, multiple temperature control for the facilities and IT-based customized in-house computer system, creates a real time database that will make it easy to access information for both the proponents and the producers.

Officials said the innovative technology that will be introduced will enhance the level of skills and technology expertise of local workers.