KUALA LUMPUR: Kejuruteraan Asastera Bhd (KAB) and Pinetree Field Sdn Bhd have signed a memorandum of understanding (MoU) to raise RM100 million in two years through private placement to assist the former with its expansion plans.

KAB managing director Datuk Lai Keng Onn said it was looking at venturing into the hydro power sector which required a substantial amount of capital.

"There is a reason why we want to raise more funds because we are expanding into hydro power which is capital intensive. We have also recently ventured into the telecommunication sector with over 1000 sites and that is investment heavy as well.

"Of course by looking at various sources of funding, we are seeking lower interest or lower cost of funding and that is why we are working closely with Pinetree to raise more fund," said Lai at the MoU signing ceremony here today.

Lai said the company was experiencing rapid growth and green energy had been a heavily-discussed topic in the market.

Pinetree founder Sophia Chin said KAB was worth investing into due to the latter's projects that focus on energy saving.

"This fund is privately set up with all existing private clients that have been with us. To engage in this, we encourage the clients or investors to talk to our consultants," she added.

In January, KAB announced that its wholly-owned KAB Energy Holdings Sdn Bhd had entered into a term sheet agreement with Sarawak Cable Bhd (SCB) to buy a 100 per cent stake in the latter's Indonesia-based unit PT Inpola Mitra Elektrindo (PT IME) for RM10,000.

PT IME designs, constructs, develops and operates a mini hydro power plant known as the Kombih III which is situated at Sungai Kombih, North Sumatera in Indonesia.

It has an existing power purchase agreement to supply electricity to Indonesia state-owned utility company, PT Perusahaan Listrik Negara with a concession period of 20 years.

"The hydro power plant that we have in the pipeline is in Indonesia and we are also looking at further projects in Indonesia as well as Malaysia. In Indonesia we are looking at brownfield projects while in Malaysia we are studying greenfield projects. Hopefully these will materialise soon," he said.

Last month, KAB partnered with privately-held MRH Empire Sdn Bhd to enter into the telecommunication infrastructure sector.

KAB, via its wholly-owned KAB Telco Sdn Bhd (Kabtel) entered into a term sheet with MRH for a joint venture (JV).

Kabtel will hold a 60 per cent stake in the JV company while MRH the remaining 40 per cent.