FGV bought six companies above market price

TheEdge Wed, Apr 10, 2019 09:12pm - 4 years View Original


KUALA LUMPUR (April 10): The White Paper on the Federal Land Development Authority (Felda) confirmed that FGV Holdings Bhd bought six companies above market price for a total sum of RM2.48 billion.

They are: Pontian United Plantations Bhd (RM1.21 bilion), Asia Plantations Ltd (at RM628 million or 290% above market price in 2014) as well as other four companies and a plot of plantation in Sabah from Golden Land Bhd (RM655 million).

Apart from Asia Plantations Ltd, the White Paper did not indicate the market price of the other acquisitions.

Sabah-based Pontian United Plantations was bought by FGV in July 2013 at RM1.21 billion cash or RM140 per share for 8.65 million shares.

At the time, it was reported that Pontian United Plantations’s main assets included the 16,000ha mature oil palm land as well as a 90-tonne-per-hour mill and kernel crushing facility.

However, several subsidiaries of the company have been hauled to court in 2016 over land-related claims, FGV announced in June 2016.

Similarly, at least one of the four companies acquired from Golden Land were sued in August 2017 for rights to land plots in Sabah.

As at end-2018, Felda held 33.67% stake in FGV Holdings, which it listed on Bursa Malaysia in 2012.

The initial public offering (IPO) of 2.2 billion FGV shares at RM4.55 apiece raised RM5.99 billion for Felda, while FGV itself gained RM4.89 billion from the IPO — part of which the latter used for the above acquisitions.

FGV shares closed at RM1.30 today, giving it a market capitalisation of RM4.74 billion. The counter has risen by 85.71% since the beginning of the year.

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