Emery Oleochemicals, a manufacturer of plastic additives made mostly from palm oil, may sharply boost its fundraising as it plans to expand globally and explore tie-ups with companies in top palm oil producer Indonesia, its chief executive said.

The Thai-Malaysian joint venture is reviewing its 480 million ringgit ($158.9 million) Islamic bond plan to fuel its growth to meet higher demand for oleochemicals, used in soaps and pharmaceuticals, Kongkrapan Intarajang said on Tuesday.

"Growth is going to be bigger than expected. We hope to announce something in the second quarter," Intarajang told Reuters in an interview on the sidelines of the Bursa Malaysia Palm Oil Conference.

Funding could come from a combination of sources and financial instruments.

A joint venture between the plantation division of Malaysia's Sime Darby, the world's largest palm oil firm by estate holdings, and the international arm of Thailand's PTT Global Chemical, Emery Oleochemicals is headquartered in Malaysia.

The firm operates about one million tons of oleochemical capacity across Europe, the United States and Asia, making it one of the biggest producers of specialty chemicals used also in cosmetics and soaps.

The Islamic bonds, which were supposed to be sold in the second quarter of this year, would finance the construction of three Malaysian plants with a combined annual capacity of roughly 60,000 to 80,000 tons.

One of the plants, with a yearly capacity of 20,000 tons, will come online in the second quarter of 2012 and will produce green polymer additives that is used to manufacture plastics, Intarajang said.

Keen On Indonesia

Indonesia also offers opportunities as it recently slashed its export taxes for processed palm oil, to help refiners and processors tap greater margins.

"It is not only about the tax but Indonesia has more feedstock supply. We are looking at good Indonesian partners and we are still at the exploratory phase of talks," Intarajang said.

"We could also be looking at the Malaysian plantation companies with holdings in Indonesia," he added.

Emery's expansion comes as Asian demand for home and personal care products, which use oleochemicals, rises in tandem with incomes and resilient economic growth.

"We are banking on Asian growth. There is some concern on global economic growth but we are competitive and we have good relationships with our consumers and suppliers," Intarajang said. "Feedstock costs can be volatile but that is a normal part of business."

Competitors for Emery include IOI Corp and KL Kepong, Malaysia's second- and third-largest palm oil firms and Wilmar International, the world's top listed palm oil processor.

Backed with plantations, these firms have been aggressive at expanding oleochemical capacity or acquiring smaller factories to grow the business.

KL Kepong bought a 150,000 tonne per year fatty acids facility in Germany from British oleochemical maker Croda International in 2010. Wilmar snapped up Malaysian oleochemicals firm Natural Oleochemicals in the same year.

"More consolidation will happen but it will be more selective compared to the 2007-2008 financial crisis that created the environment for more mergers and acquisition," Intarajang said.