11/1/06 Kuala Lumpur (The Edge Daily) - Kepong Bhd (KLK) has proposed to increase its oil palm plantation area in Indonesia via the acquisition of Tri-Force Element Inc and Double Jump Ltd for RM22 million cash.

KL-Kepong said its unit, KL-Kepong Plantation Holdings Sdn Bhd, had entered into a conditional agreement with Delta Rank International Ltd to acquire the entire paid-up share capital of its subsidiaries, Tri-Force and Double Jump.

"The proposed acquisition will enable KLK to further increase its oil palm plantation area in Indonesia and forms part of KLK's long-term objective to expand its oil palm operations in Indonesia to take advantage of suitable agricultural land and labour," it told Bursa Malaysia on Jan 11.

It said the purchase consideration would consist of RM11.6 million for Tri-Force and RM10.4 million for Double Jump.

The two are investment holding companies and their sole investment is in PT Jabontara Eka Karsa, in which Tri-Force holds a 50% equity interest and Double Jump, 45%.

Jabontara owns 14,086ha of land in East Kalimantan, which is intended for development into oil palm plantations, of which 1,300 ha have been planted with oil palm.

KLK said the proposed acquisition would be financed by internally generated funds.