Friday 02 Jun 2023
By /
main news image

KUALA LUMPUR (Oct 23): Kulim (Malaysia) Bhd (Kulim) will distribute RM1 billion or 78 sen per share from the proceeds of the sale of its  73.48 million shares that represent its entire 48.97% stake in New Britain Palm Oil Ltd (NBPOL) to Sime Darby Plantation Sdn Bhd (Sime Darby Plantation), for GBP525.4 million or RM2.75 billion.

Kulim, via a filing to the local bourse this evening, said it will distribute the RM1 billion over a period of two years after the disposal.

And of the sale proceeds, it said it will use RM600 million to repay bank borrowings within the next six months, which should bring down its gearing from 0.4 times to 0.21 times. Meanwhile, another RM300 million will be used as general working capital for the next 12 months.

It will also set aside RM850 million from the proceeds for investments or acquisitions of viable assets and businesses, in the next two years. Specifically, it intends to part finance Kulim’s oil palm plantation and its venture into the oil and gas sector in Indonesia.

The filing also said it has received a formal offer document from Sime Darby Plantation today, to acquire its NBPOL stake at an offer price of GBP7.15 per share or RM37.47.

The offer price is at a premium of 85% to NBPOL’s last closing price of GBP3.87 on Oct 8, at the London Stock Exchange.

The offer price also represents a massive gain for Kulim, whose original cost of investment of the 73.48 million shares is approximately RM216.39 million. It had originally acquired 96 million NBPOL shares for RM282.71 million in 1996, but has since disposed of 22.52 million shares with a cumulative gain of about RM113.35 million. 

Kulim’s board of directors had expressed on Oct 9, that it intended to accept the offer from Sime Darby Plantation if there were no other superior offer. The company will now put the proposed disposal to the shareholders, at an extraordinary general meeting to be convened at a later date.

      Text Size