KUALA LUMPUR: Genting Plantations Bhd’s unit, AsianIndo Holdings Pte Ltd has entered into a conditional sale and purchase agreement with Lee Rubber to acquire 100 per cent stake in Knowledge One Investment Pte Ltd for USD94.97 million.
The company said Knowledge One holds the rights to cultivate about 14,661 ha of land in Kalimantan, Indonesia via its 85 per cent owned-subsidiary, PT Kharisma Inti Usaha.
Upon completion of the acquisition, Genting Plantations will own 85 per cent stake in Kharisma.
Genting Plantation said the acquisition which will be financed externally is in line with its aim to expand its plantation landbank.
“It will increase Genting Plantations’ combined plantation landbank in Malaysia and Indonesia by 14,661 ha from its present 227,936 ha to 242,597 ha.
“It also accelerates its upstream expansion in Indonesia as some 12,893 ha have already been planted, thus increasing its total planted area in Indonesia to 84,833 ha, an increase of 17.9 per cent,” it said.
The company said the addition of Kharisma’s 60 metric tonnes per hour palm oil mill will bring its ownership of oil mills in Indonesia to four units with a total milling capacity of 255 metric tonnes per hour.
The proposed acquisition is expected to contribute positively to the earnings as well as to shareholders’ value of the company in the future, it added.
Genting Plantations said the prospects of Knowledge One and Kharisma are expected to be reasonably positive mainly due to the positive outlook of the palm oil business.
The proposed acquisition is expected to be completed in the fourth quarter of the year.