Saturday, September 18

Boustead Plantations to buy land, palm oil mill worth RM433 million

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KUALA LUMPUR: Boustead Plantations Bhd (BPB), as part of its overall strategy to expand its landbank, plans to acquire a 5,500 hectares (ha) of prime plantation land and a 60-tonne per hour (tph) palm oil mill in Sabah for RM433 million.

In a statement yesterday, it said the group via its wholly-owned subsidiary, Boustead Rimba Nilai Sdn Bhd, has issued a letter of intent for the proposed acquisition of the land and palm oil mill.

The proposed acquisition follows the group’s proposed acquisition of 11,600ha of land in Labuk and Sugut, Sabah.

BPB said upon completion of the proposed acquisition, the group’s total plantation landbank would expand by six per cent from 93,400ha to 98,900ha, giving it an increase of five per cent in total planted area from 75,000ha to 79,000ha.

“We will be able to benefit from greater economies of scale as a result of the proximity of these estates to our existing estates in Sabah.

“Not only will we be able to lower our operations cost, we will also enjoy opportunity cost savings on the construction cost of a new palm oil mill,” said Vice Chairman Tan Sri Lodin Wok Kamaruddin, adding that BPB would also see increased revenue and profit from the selling of crude palm oil instead of fresh fruit bunches.

The group, he said, was confident in the enormous economic potential and synergistic benefits

should this proposed acquisition be completed successfully.

“This will also spell stronger growth prospects for the group in the years to come,” said Lodin. — Bernama