KUALA LUMPUR (Sept 12): Chin Teck Plantations Bhd is to acquire Kelantan-based planter Fauzi-Lim Plantation Sdn Bhd for RM45 million cash.

The group said the acquisition would provide it with an opportunity to pursue its long-term strategy of expanding its plantation business through brownfield oil palm plantations.

"The long-term prospects of palm oil is promising as there is a global demand for palm products," said Chin Teck in a bourse filing.

The group said its wholly owned subsidiary, VMAS Untung Sdn Bhd, is buying the plantation firm from MWE Holdings Sdn Bhd.

"The board is of the view that the proposed acquisition is expected to contribute positively to the future financial performance of the group," it added.

Chin Teck said the acquisition is expected to be completed by the end of this year.

Shares in Chin Teck closed 13 sen or 1.55% lower at RM8.25 on Monday (Sept 12), giving the group a market capitalisation of RM753.75 million.