OPERATIONAL EFFICIENCIES: Plantation operator to buy remaining 51pc in Felda Holdings for RM2.2b
Felda Global Ventures Holdings Bhd (FGV) is buying the remaining 51 per cent of Felda Holdings Bhd for RM2.2 billion to take complete control of the entire plantation chain.
It will buy the 112.19 million shares from Koperasi Permodalan Felda Malaysia Bhd (KPF) for RM19.61 each.
FGV, the world's third-largest manager of oil palm plantations, will use proceeds from its RM10.4 billion initial public offering last year and borrowings to fund the acquisition.
The offer follows FGV's recent RM1.2 billion takeover of Pontian United Plantations Bhd.
FGV said the Felda Holdings deal will see the company becoming a fully integrated oil palm plantation player.
Felda Holdings is the world's largest producer of crude palm oil (CPO) by volume. Last year, it produced 3.3 million tonnes of CPO, accounting for eight per cent of the total global output.
"This will enable FGV to attain operational efficiencies and synergies within the plantation value chain of the FGV group.
"The acquisition will also align the management and equity interest of the midstream and downstream activities," it said.
The proposed acquisition, expected by year-end, is subject to KPF delegates' approval and FGV shareholders' nod.
Felda Holdings made RM484.2 million net profit in the year ended December 31 2012.
The company has almost 19,000 employees, more than 40,000 workers at the 138 Felda-owned estates, 71 palm oil mills, seven refineries, four kernel crushing plants, nine rubber factories, manufacturing plants and several logistics and bulking installations in Malaysia and overseas.
KPF is an investment cooperative that promotes and consolidates Felda settlers and staff savings. Its core investment is in Felda Group's equity shareholdings.
Felda Holdings' paid-up capital is RM220 million, comprising 219.99 million shares of RM1 each and one special share of RM1 held by the government through the Minister of Finance (Incorporated).
On Bursa Malaysia yesterday, FGV eased two sen to RM4.25 with 1.49 million shares traded.