8/5/07 (The Edge News)  - Felda Holdings Bhd will buy up to 80% of Twin Rivers Technology of Quincy, Massachusetts (TRT), one of North America's leading oleochemical companies, said Felda group managing director Datuk Mohd Bakke Salleh.

He said it would acquire between 70% and 80% of Twin Rivers within 90 days. Family-owned TRT produces premium oleochemicals such as fatty acids and esters for the food, fabric, personal care, industrial and energy markets.

The parties were scheduled to sign a memorandum of understanding for the proposed acquisition, to be witnessed by Deputy Prime Minister Datuk Najib Razak at the biotechnology conference, BIO 2007, in Boston.

Declining to reveal the cost of the proposed acquisition, Mohd Bakke said it was undergoing a due diligence exercise by PricewaterhouseCoopers and would be subject to the approval of the board of directors of both companies.

TRT's vice president of operations, Scott Chatlin, said its revenues were in the region of US$200 million (RM681.5 million). TRT has 180 employees and two processing sites – one in Quincy and one in Cincinnati, Ohio. Each site has an annual production capacity of 180,000 tonnes.

The Ohio site is the largest biodiesel processing facility in the US and produces 170,000 tonnes of soybean- based biodiesel annually. The Massachusetts facility processes mostly coconut oil from Southeast Asia, and also some soybean and palm oil.

TRT's two biggest clients are consumer goods giants P&G and Unilever. It is the world's only producer of Olestra, a fat replacement.

In a joint press statement, the two companies said the acquisition of TRT would provide the Felda group with a business presence in North America, a leading market for oleochemicals and natural products.

“Felda is the world's largest producer of palm oil, meeting 8% of the global need,” said Mohd Bakke. Felda has existing foreign joint ventures in Pakistan, China and Sri Lanka.

He said Felda wanted to establish itself as a formidable player in the manufacture of palm oil and palm derivative products over the next 50 years. "This will lessen dependence of Felda settlers on primary crops and increase their non-farm earnings.”

TRT chief executive officer Ian Edwards said TRT would gain a strong financial and strategic shareholder and access to Asian markets and special knowledge about palm oil and its derivative products.

He added that he intended to maintain and grow the facilities in the US.