RM342m gain for FGV from stake sale

KUALA LUMPUR: Felda Global Ventures Holdings Bhd (FGV) has raked in more than RM342 million one-off gain, outpacing what the giant planter makes in a quarter, from the sale of its 20 per cent stake in Tradewinds (M) Bhd to billionaire Tan Sri Syed Mokthar Albukhary.

The RM342 million is larger than the RM179.6 million net profit FGV made in the fourth quarter ended December alone, which had been dragged by lower crude palm oil (CPO) prices.

In its filing to Bursa Malaysia yesterday, Tradewinds said it had completed its purchase of 59.2 million shares from FGV at RM9.30 a piece worth a total of RM550.5 million.

FGV acquired the 20 per cent stake in 2010 from Grenfell Holdings Sdn Bhd at RM3.50 a share, totalling RM208 million cash.

With the completion of the deal, FGV has made a net gain of RM342 million or a return on investment of 264 per cent.

Grenfell is a company linked to the PPB Group Bhd, controlled by Malaysia's richest man Robert Kuok.

FGV president and chief executive officer Datuk Sabri Ahmad could not be reached for comments, but last December said that proceeds from the sale will be used in its upstream sector - to buy more plantation land for rubber and oil palm in countries such as Myanmar, Cambodia and Indonesia.

"With proceeds of RM342 million, FGV can buy controlling stakes in many other companies," said an analyst who declined to be named.

Syed Mokhtar announced last December his plan to take Tradewinds private, of which, sources said, will be restructured into four separate divisions - rubber, sugar, oil palm and rice.

The plan is expected to lead to the privatisation of both Tradewinds Plantation Bhd and the country's sole rice importer Padiberas Nasional Bhd (Bernas).

The low-profile businessman and Malaysia's seventh richest was taking over Tradewinds by offering shareholders RM9.30 for every share he did not already own in the company.

The vehicle for the deal is his private companies - Perspective Land Sdn Bhd, Kelana Ventures Sdn Bhd, Seaport Terminal (Johor) Sdn Bhd and Acara Kreatif Sdn Bhd - which would acquire all the shares they did not already own in Tradewinds by cash.

The whole privatisation deal is expected to cost RM2.5 billion.

Prior to the purchase of the 20 per cent stake, Syed Mokhtar directly and indirectly owned 42.97 per cent of Tradewinds, which in turn, had 69.76 per cent and 72.57 per cent control of Tradewinds Plantation and Bernas, respectively.

It was also reported that from January 2010 to date, FGV has received net dividends totalling RM46.3 million from the Tradewinds stake.

FGV is one of the world's largest plantation company, owning over 850,000ha land in Malaysia, 500,000ha of which it leases and manages for the country's 112,635 smallholders.

The plantation conglomerate, which produces over three million tonnes or 10 per cent of the world's CPO output, is already flushed with RM4.4 billion cash, raised from its initial public offering in June last year.