KUALA LUMPUR (April 22): JAG Capital Bhd (KL:JAGCPTL), formerly KUB Malaysia Bhd, is divesting its entire 30% equity interest in Sarawak-based oil palm operator Sinong Sepadu Sdn Bhd for RM44.3 million, citing strategic differences with its joint venture partner.

The group said its indirect wholly-owned subsidiary, KUB Agro Holdings Sdn Bhd, had on April 22 signed a share purchase agreement with Sinong Enterprise Sdn Bhd — which owns the remaining 70% in Sinong Sepadu — for the disposal of 1.95 million shares in Sinong Sepadu.

Sinong Sepadu owns two estates in the Oya-Dalat Land district, Mukah, Sarawak, spanning about 4,614.5 hectares.

The disposal consideration was based on an implied equity value of about RM147.67 million for the company, translating to a price of approximately RM32,000 per hectare.

The price represents a premium of 23.1% over the market value attributed to the 30% stake, based on an independent valuation using the discounted cash flow method.

JAG Capital, controlled by Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani, expects to record a pro-forma gain of approximately RM17.42 million from the transaction, which is set to strengthen its net assets and earnings position.

The group said the decision to exit the investment was due to its non-controlling position and differing priorities with its partner on key business matters.

Proceeds from the disposal will be used for working capital and may be allocated to interest-bearing deposits or short-term instruments, while the group evaluates new investment opportunities.

The transaction is expected to be completed by the third quarter of 2026, subject to regulatory approvals and fulfilment of conditions precedent.

Shares in JAG Capital — which is involved in the liquefied petroleum gas, cables, building materials and ICT businesses — closed unchanged at 98.5 sen on Wednesday, valuing the group at RM548.9 million. Over the past one year, the stock has jumped 75.9%.