KUALA LUMPUR (Aug 19): Sime Darby Plantation Bhd and PTTGC International Pt Ltd are exiting their joint venture (JV) in the Asia-Pacific business of Emery Oleochemicals (M) Sdn Bhd (EOM) and Emery Specialty Chemicals Sdn Bhd (ESC) by selling their collective 100% stake for RM38 million to Edenor Technology Sdn Bhd.

EOM, ESC and its respective subsidiaries, collectively referred to as Emery Group, is a 50:50 JV between Sime Darby Plantation and PTTGC.

In a filing on Thursday, Sime Darby Plantation said it has, together with PTTGC, inked a sale and purchase agreement to divest their collective stake in Emery Group to Edenor Technology for a target equity value of RM38 million.

"The equity consideration of RM38 million is derived based on enterprise value of RM243 million less the target net debt of RM205 million. The final sale consideration will be subject to price adjustments based on the net working capital and net debt position of EOM and ESC at completion," it said.

Edenor Technology is a JV company jointly incorporated by Mega First Corp Bhd and 9M Technologies Sdn Bhd to undertake the proposed acquisition.

Sime Darby Plantation noted that the divestment is conditional upon the restructuring of Emery Group into separate stand-alone groups in respect of its Asia-Pacific business, and the North America and Europe businesses.

"Post restructuring, Emery Group's Asia-Pacific business will remain under EOM and ESC, while its North America and Europe businesses, both held under Emery Oleochemicals UK Ltd, will be transferred out from EOM, to be held directly by Sime Darby Plantation and PTTGC on a 50:50 basis," it added.

The group said the divestment is not expected to have a material effect on its earnings, consolidated net assets and consolidated gearing for the financial year ending Dec 31, 2021.

Sime Darby Plantation's share price closed six sen or 1.56% lower at RM3.79 on Thursday, valuing the group at RM26.21 billion.