The political opposition that torpedoed the deal may be a blessing in disguise for KLK.
Kuala Lumpur Kepong Bhd CEO Lee Oi Hian and his board members should be thanking their lucky stars the agreement with the Armed Forces Fund Board and Boustead Holdings Bhd to acquire a stake in Boustead Plantations Bhd collapsed dramatically last week.
Opposition members of parliament have questioned why the unity government gave its blessing to LTAT to sell the stake to KLK, arguing the deal may adversely affect Bumiputera interests. It would then extend a mandatory general offer at RM1.55 per share to raise its shareholding to 65% and delist BPlant. LTAT and BHB, which collectively hold a total of 68%, would retain the remaining 35% stake.
The research house said approximately RM229.2 million of the purchase consideration of RM1.1 billion will be funded via operating cash flows while the remaining RM916 million will be funded via bank borrowings. That is not the end of the story. In addition to the RM2.24 billon for a 65% stake , KLK also needs to fork out hefty capital expenditure to replant BPlant’s entire ageing planted area of 33,253ha.
Some may argue a RM3 billion investment sounds like a good deal given BPlant manages 42 oil palm estates and 10 palm oil mills nationwide. It also has a total landbank of approximately 97,399ha and a total planted area of 72,291ha.However, some research houses beg to differ. PublicInvest said it is positive on the unsuccessful acquisition.
Italia Ultime Notizie, Italia Notizie
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