MARKET DEVELOPMENT
Kulim to Record Gain of RM1.56b From NBOL Sale
Kulim to Record Gain of RM1.56b From NBOL Sale
24/10/2014 (The Star) - Kulim (M) Bhd expects to record a gain of RM1.56bil from the sale of its 48.97% stake in New Britain Palm Oil Ltd (NBOL) to Sime Darby Bhd.
It said on Thursday it was selling its stake at £7.15 (RM37.47) a share to Sime Darby as there was no superior offer from other parties for its stake.
For illustrative purposes, based on the latest audited consolidated financial statements at Dec 31, 2013, and assuming the disposal was on that date, “Kulim expects to realise a gain on disposal of approximately RM1.56bil”, it said.
Sime Darby had launched an offer on Oct 9 to buy all of the shares in NBPOL – which has plantations in Papua New Guinea -- for £1.073bil in a move to expand its plantation business.
Kulim said it had received the formal offer document from Sime Darby and in the absence of a superior offer, “the board has agreed to present the proposed disposal to the shareholders of Kulim at an EGM to be convened for their consideration and approval”.
To recap, on Oct 25, 1996, Kulim and its subsidiaries made the initial investment in NBPOL by buying 96 million NBPOL shares for RM282.71mil.
Since its investment in 1996, Kulim Group had sold 22.517 million NBPOL shares with a cumulative gain of RM113.35mil on disposal.
The original cost of investment of the remaining 73.482 million NBOL shares held was about RM216.39mil.
“The proposed disposal provides a timely opportunity for Kulim to dispose of its large shareholdings in NBPOL and realise its investment in NBPOL at an attractive premium above the historical trading prices of NBPOL and at the valuation multiples.
“Moreover, the proposed disposal is also aligned to the offer, whereby Sime Darby has received a letter dated Oct 1, 2014 from the honourable Prime Minister of the Independent State of PNG acknowledging that Sime Darby is keen to make a general offer for NBPOL and reiterating that Sime Darby’s proposed acquisition of shareholding in NBPOL will not be contrary to PNG’s national interest in relation to Rule 27A of the PNG Code,” it said.
Kulim added the proposed disposal would reduce the group’s gearing from about 0.40 times to about 0.21 times and strengthen the working capital of Kulim Group to support its core plantation business and new ventures locally and abroad.
Kulim said the proposed disposal was also in line with its strategy of constantly evaluating its portfolio of investments and where possible seeking opportunities to unlock the value of its investments for the benefit of the shareholders of Kulim.
It said on Thursday it was selling its stake at £7.15 (RM37.47) a share to Sime Darby as there was no superior offer from other parties for its stake.
For illustrative purposes, based on the latest audited consolidated financial statements at Dec 31, 2013, and assuming the disposal was on that date, “Kulim expects to realise a gain on disposal of approximately RM1.56bil”, it said.
Sime Darby had launched an offer on Oct 9 to buy all of the shares in NBPOL – which has plantations in Papua New Guinea -- for £1.073bil in a move to expand its plantation business.
Kulim said it had received the formal offer document from Sime Darby and in the absence of a superior offer, “the board has agreed to present the proposed disposal to the shareholders of Kulim at an EGM to be convened for their consideration and approval”.
To recap, on Oct 25, 1996, Kulim and its subsidiaries made the initial investment in NBPOL by buying 96 million NBPOL shares for RM282.71mil.
Since its investment in 1996, Kulim Group had sold 22.517 million NBPOL shares with a cumulative gain of RM113.35mil on disposal.
The original cost of investment of the remaining 73.482 million NBOL shares held was about RM216.39mil.
“The proposed disposal provides a timely opportunity for Kulim to dispose of its large shareholdings in NBPOL and realise its investment in NBPOL at an attractive premium above the historical trading prices of NBPOL and at the valuation multiples.
“Moreover, the proposed disposal is also aligned to the offer, whereby Sime Darby has received a letter dated Oct 1, 2014 from the honourable Prime Minister of the Independent State of PNG acknowledging that Sime Darby is keen to make a general offer for NBPOL and reiterating that Sime Darby’s proposed acquisition of shareholding in NBPOL will not be contrary to PNG’s national interest in relation to Rule 27A of the PNG Code,” it said.
Kulim added the proposed disposal would reduce the group’s gearing from about 0.40 times to about 0.21 times and strengthen the working capital of Kulim Group to support its core plantation business and new ventures locally and abroad.
Kulim said the proposed disposal was also in line with its strategy of constantly evaluating its portfolio of investments and where possible seeking opportunities to unlock the value of its investments for the benefit of the shareholders of Kulim.