FGV to buy 37pc of PT Eagle High Plantations for US$680m

Publish date: Fri, 12 Jun 2015, 03:20 AM

KUALA LUMPUR: - Felda Global Ventures Holdings Bhd (FGV) has signed a Heads of Agreement with Rajawali Group to acquire a 37 per cent stake in PT Eagle High Plantations (EHP) for US$680 million (US$1=RM3.69) in cash and stocks.

Under the proposed acquisition, FGV will pay US$632 million in cash for 30 per cent stake and 95 million new FGV shares for the remaining seven per cent stake.

This would result in Rajawali Group owning 2.6 per cent of the enlarged FGV share base, FGV said in a statement today.

In addition, FGV will also acquire between a 93 per cent and 95 per cent stake in Rajawali Group's sugar project for US$67 million.

The stakes in EHP and Rajawali Group's sugar project will be owned by FGV Kalimantan Sdn Bhd, a unit of FGV.

Upon completion of the deal, FGV will become a partner of Rajawali Group, a highly respected local conglomerate, which will remain the controlling shareholder in EHP, the third largest oil palm company in Indonesia.

The deal was expected to be funded by a combination of internal resources and external financing.

More details would be finalised when the definitive agreements were signed, FGV said.

"It is important to note that this acquisition will in no way affect FGV's dividend policy.

"The company is firmly committed to delivering on its promises to shareholders," said FGV Group President and Chief Executive Officer Datuk Mohd Emir Mavani Abdullah.

He said FGV's technology, downstream expertise and global footprint would bring significant value to Rajawali as the latter seeks to extract operational efficiencies and streamline costs through this transaction.

Currently, EHP owns 425,000 hectares of oil palm plantations, out of which 67 per cent are in Kalimantan and the rest spread over Papua New Guinea (nine per cent), Sulawesi (19 per cent) and Sumatra (five per cent).

Rajawali is a strong partner in Indonesia and the transaction provides access to a formidable platform in Southeast Asia's largest market, with significant revenue and cross-selling opportunities through its extensive network and credentials.

In a filing to Bursa Malaysia, FGV's shares will resume trading on Monday after being suspended on Thursday and Friday at RM1.86.

Accordingly, trading in the structured warrants relating to FGV will also resume at the same time. -- BERNAMA

Discussions
Be the first to like this. Showing 6 of 6 comments

calvintaneng

Better buy KULIM for 4 Reasons

1) Kulim has Solid Assets in Johor. NTA over RM3.60. Net Cash over RM2 Billions

2) Iskandar Boom will lift up Kulim Asset Prices. No earthquake in Iskandar unlike Sabah.

3) Kulim has EA Tech. Doing very well in Oil & Gas

4) Kulim is converting 14,000 acres Oil Palm Lands into Housing In Booming Pengerang Region.

Switch all FGV Shares into Kulim now!

KULIM

Kaboom
Upward
Lavishing
In
Money

2015-06-13 15:23

cpo_

A smart investor will choose a cheaper stock to buy which is FGV. FGV is among world biggest plantation companies yet trade at cheaper price than Kulim, IOI, Sime Darby and KLK.

2015-06-13 16:02

calvintaneng

Price is One Thing. Value is another.

Hmmmm?

Let me give an example.

There are 3 Boxes each with 1 Kg of Stuff Inside.

Let's say

Box A sells for RM50 for a hudden kg

Box B sells for RM300 for a kg

Box C sells for RM1,000 for a kg

Looking at Prices Most People Will pick Box A because of Price. Only RM50 a kg.

Who will pick Box C for RM1,000 a kg? Almost zero!!

Unless?

Unless You KNOW THE VALUE.

Now Open All 3 Boxes & SEE!

Box A contains a kg of sand!! RM50 for a kg of sand is very expensive!

Box B holds a kg of silver. RM300 for a Kg of Silver is cheap. Mkt Value is $500

Box C encases a kg of pure gold. RM1,000 for a kg of gold is really very, very very cheap. Gold is worth at least US$36,000 a kg currently.

Phil Fisher says, "Everybody knows the price of a thing but not its value"

KULIM IS DIRT CHEAP COMPARED TO FGV.

How come?

The 14,000 acres of Strategic Lands in Pengerang are worth over RM10 Billions if developed into houses and sold for just RM500,000 a unit for a 2 storey link house.

Almost all Kulim Land Banks are located in Iskandar & Johor. Some in Indonesia.

2015-06-13 18:33

andychucky28

PT Eagle Highlat is own by ajib very good friend. So buy at your own risk!

2015-06-13 18:49

yick78

now crude oil and cpo are surplus in the market.still want to buy more plantation. really want to loss money!

2015-06-13 22:13

CFTrader

With current asset and debts, and it's profitibility and it's Cashflow generation, I wonder how they going to fund this acquisition ?

More debts ? More interest payment that eats into the profit ?
More issuance of share and dilute the current shareholder ?
What is the profit that the new acquisition company bring to FGV ?


God bless FGV shareholder .

2015-06-13 22:44

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