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August 26, 2020 20:33 pm +08
 
 
 
TSH Resources sells two Indonesian plantation units to KLK to pay debts
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KUALA LUMPUR (Aug 26): TSH Resources Bhd is disposing of its 90% stakes in two Indonesian subsidiaries to Kuala Lumpur Kepong Bhd (KLK), realising cash proceeds of RM517.62 million.

TSH said in a statement the money will be used mainly to repay its bank borrowings which amount to RM513.12 million.

Post-disposal, the group’s net gearing will be reduced to 0.48 times from 0.83 times as at Dec 31, 2019.

"The improved gearing will also provide greater capacity to raise additional funding to accelerate the development of its remaining unplanted plantation lands. Upon maturity, the remaining plantation lands will contribute positively towards the TSH Resources group’s financial performance,” it added.

Meanwhile, TSH will also recognise an RM39 million profit on the disposal.

The disposal involved 10,816 hectares of planted oil palm area in East Kalimantan with a combined 231,255 tonnes of fresh fruit bunches production in 2019.  

TSH Resources’ wholly-owned subsidiaries TSH Global Plantation Pte Ltd and TSH Oversea Pte Ltd today entered into conditional sale and purchase agreements with Taiko Plantations Pte Ltd, an indirect wholly-owned subsidiary of KLK, for the disposal of their 90% stakes in PT Farinda Bersaudara and PT Teguh Swakarsa Sejahtera.

In a separate filing, KLK said Taiko Plantations will be buying the 90% stakes in the two palm oil companies for a collective US$110.1 million, which will be funded by a combination of the group’s existing cash reserves and bank borrowings.

Taiko Plantations will pay US$76.7 million for the stake in PT Farinda Bersaudara and US$33.4 million for the stake in PT Teguh Swakarsa Sejahtera.

The planted/plantable area of PT Farinda Bersaudara Land and PT Teguh Swakarsa Sejahtera Land totals 17,610 ha, which together with the planted area of KLK’s existing PT Putra Bongan Jaya estates at 10,000 ha, would make up a sizeable 27,600 ha, all located at the same place in Kutai Barat, and will allow for greater economies of scale and operational synergies, said KLK.

TSH Resources’ share price ended one sen or 1.01% lower at 98.5 sen today, valuing the group at RM1.36 billion.

KLK closed 16 sen or 0.7% lower at RM22.64, bringing it a market capitalisation of RM24.42 billion.

Year to date, TSH Resources has fallen 36% from RM1.54, while KLK has dropped 9% from RM24.80.

Edited by S Kanagaraju

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SEE_RESEARCH



Noted as one of the
MAIN CATALYST OF THIS SPECIAL GAIN;
WILL DRIVE TSH INTO an uptrend mode;
with panic & frenzy buying orders 

 


The group is expected to recognise one-off gain of 

 

RM104.3 millions 

 

in the 1QFY22

REMARKS

DO NOT MISS THE BIG SALMON ON

 

TSH/9059

 

for the current feasting. 

 

 

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TSH /9059

SEE_RESEARCH 

WAIT for strong rally  VERY SOON

 First target  ------  RM 1.50

Mid term target --RM 2.00

 

.Thanks for reading and see you in the next post.

THE ABOVE IS NOT A BUY OR SELL CALL AND IS ONLY A PERSONAL OPINION, WRITTEN AS ARTICLE FOR SHARING PURPOSES TO KLSE COMMUNITY MEMBERS.

 

DISCLAIMER: Investment involves risks, including possible loss of investment and other losses. 

This article and charts are provided for information only and should not be construed as a solicitation to buy or sell any of the instruments mentioned herein. The author may have positions in some of these instruments. The author shall not be responsible for any losses or profits resulting from investment decisions based on the use of the information contained herein. If investments and other professional advice is  required, the services of a licensed professional person should be sought.

  ISSUED BY SEE RESEARCH 

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(SENSING EAGLE EYES RESEARCH )