KUALA LUMPUR — Dec. 6, 2019: TH Plantations has disposed of its entire equity interest in Bumi Suria Ventures Sdn. Bhd. (BSV) and Maju Warisan Sdn. Bhd. (MW) to Tamaco Plantation Sdn. Bhd. for RM170 million.
The companies own 6,513.80 hectares of oil palm plantations in Bintulu and Sibu.
BSV is principally engaged in the cultivation of oil palms and selling of fresh fruit bunches while MW is principally engaged in letting out investment properties.
The price consideration represents approximately RM13.9 million or a 7.6 per cent discount of the lands’ market value, according to an independent registered valuer.
The original cost of investments in BSV and MW were RM221.70 million and RM42.49 million respectively.
“The disposals are part of THP’s rationalisation plan to revive its financial performance through the divestment of assets to reduce borrowings and improve operational efficiency.
“The disposal of the companies were driven by their poor performance against the projected production,” it said.
Upon completion of the disposal, THP is expected to improve its gearing ratio from 1.09 times to 0.94 times and reduce its profit margin expenses by approximately RM9.41 million per annum.
Following the disposal, the THP Group’s land bank stood at 94,462.08 hectares, comprising oil palm and rubber plantations. — Bernama