KUALA LUMPUR (May 3): Felda Global Ventures Holdings Bhd (FGV) is still in discussions with the Federal Land Development Authority (Felda) on options to undertake which include relook at a land lease agreement (LLA) that will benefit various stakeholders, according to a Bernama report.

Its group president and chief executive officer Datuk Zakaria Arshad said the priorities of the options would be in the best interests of FGV, Felda and other shareholders and offer the best win-win solutions for all.

Felda was reportedly open to ideas to unravel the LLA and seek the return of the land that is currently leased out to and managed by FGV in an effort to extract higher returns.

Felda's interest in FGV is about 34% and the latter manages around 335,000ha out of Felda's total landbank of 850,000ha.

"The discussion started months ago and is still ongoing and we are yet to find the best solutions on how to increase FGV's share price for the benefit of its shareholders, as well as serve the interests of the Felda settlers.

"We have come out with a lot of ideas and among them is the LLA. However, nothing has been brought up to the board level yet as all are still at the discussion level," he was quoted as saying by Bernama today.

He said the LLA was an important business component for FGV, and was not an easy decision to make.

"If Felda decides to pull out from it, it would need to give 11 months notice to FGV and pay a minimum of RM3 billion in compensation for the LLA termination," said Zakaria.

He said since the actual problems that triggered the LLA options was in relation to Felda's cashflow, both parties should discuss further to address the matter as having to fork out more money for compensation would hurt Felda's cashflow even more.

Bernama also reported Zakaria as saying that he did not know the details of the discussion on the possible emergence of new shareholders in FGV following a major reshuffle by Felda.

The new shareholders are said to be Indonesian businessmen, Tan Sri Peter Sondakh, who controls PT Eagle High Plantations Tbk, and Martua Sitorus, the co-founder of Wilmar International Ltd, via injection of assets into the group in return for shares and management control.

Zakaria said FGV would welcome any equity acquisitions as long as they could bring in expertise for the benefit of the group.