KUALA LUMPUR (July 3): WTK Holdings Bhd (KL:WTK) is selling its 65% stake in palm oil unit Positive Deal Sdn Bhd, as well as 5,548 hectares of plantation land in Miri, for RM221.5 million in cash.

The assets are being sold to oil palm planter Trinity Capital Resources Sdn Bhd via a series of conditional agreements inked with WTK’s units, according to a bourse filing on Friday.

The disposals comprise the 65% stake in Positive Deal, together with all its redeemable preference shares, for RM27 million; 4,698 hectares of plantation land under wholly-owned unit Biogreen Success Sdn Bhd for RM145.2 million; and 850 hectares under wholly-owned unit Borneo Agro-Industries Sdn Bhd for RM49.3 million.

Positive Deal owns 2,149 hectares of plantation land adjacent to the 5,548 hectares being disposed of. The remaining 35% stake in Positive Deal is owned by the Sarawak state government’s Yayasan Sarawak.

The purchaser, Trinity Capital, is 50% directly owned by Tung Huat Plantations Group Sdn Bhd. The other shareholders are Agie Sally Lau Sie Sieung (10%), Lau Sie Nguong (10%), Datuk Lee Chee Kiang (10%), Datuk Seri Lau Hieng Su @ Lau Hieng Sii (10%), and Datuk Seri Lee Sie Tong @ Lee Ah Tong (10%).

“The proposed disposals form part of WTK and its subsidiaries’ ongoing efforts to optimise its plantation asset portfolio, improve operational efficiency and strengthen its financial flexibility through the monetisation of selected plantation assets,” WTK said.

The group said the price-tag on the Positive Deal stake is valued at a 6.46% premium, Biogreen Success’ land at a 4.62% premium, and Borneo Agro-Industries’ land at an 8.55% premium.

“The disposal consideration represents an overall premium of approximately RM11.9 million or 5.70% over the aggregate valuation of approximately RM209.6 million,"  it noted.

The group expects to book a disposal gain of RM86.587 million from the deal. This is computed based on the disposal consideration against its carrying value of Positive Deal (RM25.012 million), audited net book value of the plantations assets of Biogreen (RM86.214 million) and Borneo Agro-Industries (RM14.801 million) and taxes.

WTK said RM185.61 million in proceeds will be utilised for working capital for its plantation operations, RM27 million to repay bank borrowings and the remainder for disposal-related taxes and expenses.

The deals, interconditional to one another, are subject to shareholders’ approval, the Sarawak state government, and Yayasan Sarawak.

WTK anticipates completing the deals by the first quarter of 2027.

Shares of WTK ended unchanged at 76 sen, valuing the group at RM363.48 million.