MARKET DEVELOPMENT
FGV Expects to Conclude Talks on Eagle High Deal Soon
FGV Expects to Conclude Talks on Eagle High Deal Soon
21/01/2016 (The Star) - Plantation firm Felda Global Ventures Holdings Bhd (FGV) is expected to conclude negotiations on the acquisition of a stake in PT Eagle High Plantations Tbk by March.
FGV chairman Tan Sri Mohd Isa Abdul Samad said negotiations were ongoing and talks should be settled within the next two months.
“The latest is that we are still looking for a new business model. Negotiations are still on, hopefully we can settle it in one or two months.
“By March, it will definitely be settled,” he told reporters on the sidelines of a MoA signing ceremony between Federal Land Development Authority and property developer Encorp Bhd.
FGV had earlier proposed to buy a 37% stake in PT Eagle High Plantations Tbk for US$680mil (RM2.93bil) from the Rajawali Group. However, last December, it was reported that the Felda group’s investment arm, Felda Investment Corp (FIC), could acquire a stake in the Indonesian plantation company.
FGV had announced the planned acquisition in the middle of last year but there had been delays in completing the deal. Subsequently, in early December, FGV said there could be “a possible different mode of investment” into Eagle High.
Instead of the 37% stake, FGV could now be taking a much smaller stake, with the larger stake being taken by FIC, which could take away a large portion of the risk from the former, which has been hit hard by weaker crude palm oil prices.
Should FGV go it alone in the stake acquisition, the company would have to raise US$680mil.
Eagle High owns 425,000ha of land bank, with 67% in Kalimantan and the rest in West Papua, Sulawesi and Sumatra provinces, valueing the company’s entire land bank at US$4,324 per ha or a total US$1.84bil.
FGV chairman Tan Sri Mohd Isa Abdul Samad said negotiations were ongoing and talks should be settled within the next two months.
“The latest is that we are still looking for a new business model. Negotiations are still on, hopefully we can settle it in one or two months.
“By March, it will definitely be settled,” he told reporters on the sidelines of a MoA signing ceremony between Federal Land Development Authority and property developer Encorp Bhd.
FGV had earlier proposed to buy a 37% stake in PT Eagle High Plantations Tbk for US$680mil (RM2.93bil) from the Rajawali Group. However, last December, it was reported that the Felda group’s investment arm, Felda Investment Corp (FIC), could acquire a stake in the Indonesian plantation company.
FGV had announced the planned acquisition in the middle of last year but there had been delays in completing the deal. Subsequently, in early December, FGV said there could be “a possible different mode of investment” into Eagle High.
Instead of the 37% stake, FGV could now be taking a much smaller stake, with the larger stake being taken by FIC, which could take away a large portion of the risk from the former, which has been hit hard by weaker crude palm oil prices.
Should FGV go it alone in the stake acquisition, the company would have to raise US$680mil.
Eagle High owns 425,000ha of land bank, with 67% in Kalimantan and the rest in West Papua, Sulawesi and Sumatra provinces, valueing the company’s entire land bank at US$4,324 per ha or a total US$1.84bil.