MARKET DEVELOPMENT
FGV Seeks To Acquire More Assets To Improve Profitability
FGV Seeks To Acquire More Assets To Improve Profitability
28/12/2013 (Bernama) - Felda Global Ventures Holdings Bhd (FGV) is looking for more asset acquisition to improve its profitability, said Group President and Chief Executive Officer Mohd Emir Mavani Abdullah.
Speaking to the media after FGV's extraordinary general meeting (EGM) today, he said the group would acquire assets to enhance its downstream and upstream activities.
"We will be looking for further assets to acquire, upstream and downstream. We are currently reviewing all the proposals coming into our table. We are at the discussion stage with them," he said.
Asked how the group plans to fund its merger and acquisition plan, he said: "We did have our funding strategy when we drew up the plan. It could be in the form of equity or debt. We will look at the asset and returns to shareholders."
FGV is also looking to improve its operations, he added.
"We will continue to grow in 2014. We will look at our management and improving our productivity, looking at the way we do our work and the whole context (of how) we manage our business," said Mohd Emir.
He pointed out that FGV would also continue with its replanting activities.
At the EGM, FGV obtained shareholders' approval to acquire a 51 per cent equity interest in Felda Holdings Bhd (FHB) from Koperasi Permodalan Malaysia Bhd for RM2.2 billion or RM19.61 per FHB share.
The acquisition will be satisfied entirely in cash and funded by a combination of initial public offerings proceeds and borrowings, said Mohd Emir.
FGV hopes to grow its business year-to-year by eight per cent, beginning in 2014 with the integration of FHB under its stable of companies, he said.
"Post-acquisition, FGV will have greater control of the entire palm oil and rubber value chain," he said.
FHB is principally involved in the processing of crude, refined and packed palm oil products as well as the provision of shared support services such as research and development.
It is also involved in rubber processing and manufacturing of fertilisers.
Mohd Emir added that the acquisition would immediately contribute to FGV's profitability.
During the financial year ended Dec 31, 2012, FHB generated consolidated net profit of RM484.2 million with a net cash position of RM915.4 million.
Asked on the outlook for CPO prices in 2014, he said he expects the commodity to trade at between the RM2,500 and RM2,700 levels.
Speaking to the media after FGV's extraordinary general meeting (EGM) today, he said the group would acquire assets to enhance its downstream and upstream activities.
"We will be looking for further assets to acquire, upstream and downstream. We are currently reviewing all the proposals coming into our table. We are at the discussion stage with them," he said.
Asked how the group plans to fund its merger and acquisition plan, he said: "We did have our funding strategy when we drew up the plan. It could be in the form of equity or debt. We will look at the asset and returns to shareholders."
FGV is also looking to improve its operations, he added.
"We will continue to grow in 2014. We will look at our management and improving our productivity, looking at the way we do our work and the whole context (of how) we manage our business," said Mohd Emir.
He pointed out that FGV would also continue with its replanting activities.
At the EGM, FGV obtained shareholders' approval to acquire a 51 per cent equity interest in Felda Holdings Bhd (FHB) from Koperasi Permodalan Malaysia Bhd for RM2.2 billion or RM19.61 per FHB share.
The acquisition will be satisfied entirely in cash and funded by a combination of initial public offerings proceeds and borrowings, said Mohd Emir.
FGV hopes to grow its business year-to-year by eight per cent, beginning in 2014 with the integration of FHB under its stable of companies, he said.
"Post-acquisition, FGV will have greater control of the entire palm oil and rubber value chain," he said.
FHB is principally involved in the processing of crude, refined and packed palm oil products as well as the provision of shared support services such as research and development.
It is also involved in rubber processing and manufacturing of fertilisers.
Mohd Emir added that the acquisition would immediately contribute to FGV's profitability.
During the financial year ended Dec 31, 2012, FHB generated consolidated net profit of RM484.2 million with a net cash position of RM915.4 million.
Asked on the outlook for CPO prices in 2014, he said he expects the commodity to trade at between the RM2,500 and RM2,700 levels.