15/12/2009 (Proactive Investors.co.uk) - Asian Plantations Limited (AIM: PALM), which recently listed in London after successfully raising approximately £5.26 million, said it had entered into an agreement to acquire a 5,850 acre palm oil plantation in Sarawak, Malaysia for a total consideration of £12.4 million.

Asian Plantation is paying approximately £2,116 per hectare, and will fund the transaction through a new £10 million debt facility provided by a local bank in Malaysia, with the remaining funds drawn from its existing cash resources.  Asian Plantation is paying £2.6 million now, with a further £1.3 million due before 30 December 2009 and the balance paid before 31 January 2009.

The 5,850 plantation consists of around 1,000 hectares of planted land with palm tree approximately three years old. It is Asian Plantations intention to plant the remaining acreage over the next 12 months, subject to “the availability of sufficient working capital”.

For the year ended 31 December 2008, the plantation generated negligible revenues and had gross assets of £8.92 million.

The plantation is located only five kilometres from Asian Plantations existing acreage.

The palm oil plantation developer said the acquisition offered a number of strategic benefits to the company, including increased scale, a strong platform for future growth and immediate revenue generation.

"We are excited to have secured this new parcel of land, which has tremendous operational synergies with our existing estate operations and which are located in close proximity to one another,” Graeme Brown, Joint CEO, commented. “Through our long standing local relationships and on-the-ground presence, we were able to secure the parcel in a negotiated, non-competitive situation, which demonstrates our ability to source acquisition opportunities for the Company, as well as securing attractive local currency bank financing, which we believe creates long term shareholder value."

Asian Plantation listed on AIM with 4,795 hectares of land zoned for palm oil plantation in Sarawak, Malaysia, and stated that it would use the proceeds to complete planting and development .