IOI shareholders yesterday approved the companyís RM1.2 billion rights offer, the bulk of which will be used to expand and upgrade its refineries and specialty fats plants in Malaysia and the Netherlands.

ìAbout RM1 billion will go to expanding our refineries in Pasir Gudang (in the southern Malaysian state of Johor) and Rotterdam,î said IOIís Executive Chairman Lee Shin Cheng.

IOI, which owns palm oil estates in Malaysia and Indonesia, is hopeful that palm oil prices will rise to between RM2,200 ringgit and RM2,500 per tonne in the next few months, he said.

Palm oil prices on Malaysiaís derivatives market have been trading at about RM2,000 to RM2,200 in the past two months.

ìPalm oil, being a very affordable vegetable oil, continues to see strong demand. Thatís why weíre expanding capacity,î said Lee.

Malaysia is the worldís second-largest palm oil producer after Indonesia.