KUALA LUMPUR (Jan 16): PLS Plantations Bhd and Japan’s Millennium Agriculture Technology Sdn Bhd (MAT) and MyFarm Inc have recently signed a heads of agreement (HOA) to negotiate further the launch of large-scale durian cultivation in Malaysia, under a joint venture (JV) vehicle valued at RM371 million.
PLS LESB, a 51%-owned subsidiary of PLS Plantations Bhd, will be the majority stakeholder in the joint-venture vehicle, with a 51% stake, while MAT is set to invest up to 49% equity interest in the company for RM181.8 million.
PLS, which is 73%-controlled by Tan Sri Lim Kang Hoo via Ekovest Bhd, said the joint venture partnership would pave the way for Japanese technology transfer and participation in Malaysia’s long-term food security programme, in line with PLS’s vision to transform itself into Malaysia’s leading sustainable agrofood company.
PLS in a statement on Monday (Jan 16) said MyFarm operates one of the largest agricultural schools in partnership with Tokyo Agricultural University, and has produced 2,300 graduates over the past 12 years.
MyFarm’s shareholders include Japan’s National Federation of Agricultural Cooperative Associations, Tsumura & Co (a Japanese herbal medicine manufacturer listed on Tokyo Stock Exchange), Nichiryu Nagase Co Ltd (a leading Japanese distributor of agricultural machinery and farm products), DCM Holdings Co Ltd (one of the largest home improvement businesses in Japan), and SB Technology Co Ltd (previously known as Softbank Technology Corp).
“This JV will facilitate the transfer of Japanese technology and expertise in agriculture on a scale never seen before in Malaysia. It will boost PLS’s core competencies as a leading producer of export-quality agriculture and aquaculture produce,” said Lim.
The Japanese investment, which is expected to be completed this year, will see the deployment of modern Japanese agricultural practices for the planting of the “Musang King” durian species as part of the project.
PLS said that within 14 days from the execution of the HOA, MAT shall pay the stakeholder of PLS LESB, a refundable earnest deposit equivalent to 2% of the investment consideration of approximately RM3.6 million.