KUALA LUMPUR (Nov 2): FGV Holdings Bhd has not received any notice of termination of the land lease agreement (LLA) from its controlling shareholder Federal Land Development Authority (Felda).  

It has been five days since the Prime Minister's Department announced that the Cabinet had granted approval on the termination of LLA.

FGV said in a filing with Bursa Malaysia that its chairman Azhar Abdul Hamid had written Felda's chairman Datuk Seri Idris Jusoh on the matter, informing its controlling shareholder that the official termination notice for the LLA was still not forthcoming.

FGV said Azhar also suggested to stop any further media releases on the matter and to have a discussion prior to releasing a joint statement on the agreed terms in accordance with the terms and conditions of the LLA.

Felda owns a 33.66% stake in FGV.

To recap, last Wednesday Minister in the Prime Minister's Department (Economy) Datuk Seri Mustapa Mohamed announced that the Cabinet had agreed to the recommendation for the termination of Felda's LLA with FGV.

However, the announcement did not reveal the compensation that Felda needs to pay FGV as a result of the termination of the LLA.

The announcement was then followed by a media briefing last Friday during which Tan Sri Abdul Wahid Omar, the chairman of the special task force to restructure Felda, announced that Felda was keen on taking over all of FGV's palm oil mills, in addition to the termination of LLA.

The latest development will result in an earnings vacuum for FGV, considering 70% of its plantations are under LLA currently.

Nonetheless, some analysts see this as an opportunity to start a new chapter as the group could utilise the compensation from the LLA termination for asset acquisitions.

In a separate filing, the planter also announced that Mohd Hassan Ahmad, 48, resigned as its non-independent and non-executive director following him ceasing to be the representative of Minister of Finance Inc on the group's board.

FGV shares were down by 2.83% or three sen at RM1.03, valuing the plantation group at RM3.76 billion. It saw 3.74 million shares done.