MARKET DEVELOPMENT
Rajawali Sets Aside $106m Capex for Palm Oil Biz
Rajawali Sets Aside $106m Capex for Palm Oil Biz
01/12/2014 (Jakarta Globe) - Palm oil firm BW Plantation plans to nearly double its capital expenditure next year to Rp 1.3 trillion ($106 million) after conglomerate Rajawali Group took control of Green Eagle Holdings earlier this month.
BW Plantation president director Halim Ashari said the company has earmarked Rp 1.3 trillion in capital expenditure in 2015, from Rp 700 billion this year.
“Apart from boosting the capital structure, the Rajawali Group will also boost our business size through a synergy with Green Eagle Holdings,” Halim said, referring to Green Eagle Holdings’ takeover by Rajawali through its subsidiary, BW Plantation.
Green Eagle was previously a Singaporean joint venture between Rajawali and France’s Louis Dreyfus Commodities.
The combined land holdings of Green Eagle and BW Plantation are expected to make the latter the third-largest oil palm plantation firm by planted areas listed on the Indonesia Stock Exchange.
As previously reported, Rajawali’s acquisition aims to consolidate the group’s plantation assets and bring Green Eagle to the public market via a backdoor listing through BW Plantation, which has been public October 2009.
BW Plantation shareholders approved a plan on Thursday for a limited public rights issue worth Rp 10.8 trillion. According to the plan, 27.02 billion new shares will be issued.
Green Eagle operates 195,540 hectares of combined palm oil plantations in Papua and Kalimantan. As of June, it also operates two crude palm oil plants, located in South and East Kalimantan .
Combined, the two plants are able to process up to 780,000 metric tons of palm oil fruit bunches per year.
Green Eagle has also started construction of three new palm oil plants in South Kalimantan, West Kalimantan and Papua, which will boost its processing capacity to nearly 1.59 million tons annually.
Halim said between Rp 400 billion and Rp 500 billion of next year’s capex will be used to build four palm oil processing plants, while the remainder will be used for working capital, plantation maintenance and land acquisitions.
BW Plantation president director Halim Ashari said the company has earmarked Rp 1.3 trillion in capital expenditure in 2015, from Rp 700 billion this year.
“Apart from boosting the capital structure, the Rajawali Group will also boost our business size through a synergy with Green Eagle Holdings,” Halim said, referring to Green Eagle Holdings’ takeover by Rajawali through its subsidiary, BW Plantation.
Green Eagle was previously a Singaporean joint venture between Rajawali and France’s Louis Dreyfus Commodities.
The combined land holdings of Green Eagle and BW Plantation are expected to make the latter the third-largest oil palm plantation firm by planted areas listed on the Indonesia Stock Exchange.
As previously reported, Rajawali’s acquisition aims to consolidate the group’s plantation assets and bring Green Eagle to the public market via a backdoor listing through BW Plantation, which has been public October 2009.
BW Plantation shareholders approved a plan on Thursday for a limited public rights issue worth Rp 10.8 trillion. According to the plan, 27.02 billion new shares will be issued.
Green Eagle operates 195,540 hectares of combined palm oil plantations in Papua and Kalimantan. As of June, it also operates two crude palm oil plants, located in South and East Kalimantan .
Combined, the two plants are able to process up to 780,000 metric tons of palm oil fruit bunches per year.
Green Eagle has also started construction of three new palm oil plants in South Kalimantan, West Kalimantan and Papua, which will boost its processing capacity to nearly 1.59 million tons annually.
Halim said between Rp 400 billion and Rp 500 billion of next year’s capex will be used to build four palm oil processing plants, while the remainder will be used for working capital, plantation maintenance and land acquisitions.