KLK completes 56.2% stake buy in IJM Plantations, to extend full takeover offer

KLK completes 56.2% stake buy in IJM Plantations, to extend full takeover offer
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KUALA LUMPUR (Sept 6): Kuala Lumpur Kepong Bhd (KLK) said it has completed the acquisition of a 56.2% stake in IJM Plantations Bhd from IJM Corp Bhd.

The group is now obliged to extend a mandatory general offer to acquire the remaining stake in IJM Plantations at RM3.10 per share. The takeover notice was served on the board of IJM Plantations on Aug 30, KLK said in a statement today.

KLK acquired the 56.2% stake at RM3.10 per share, or a total of RM1.53 billion, after IJM Corp accepted its June 11 offer.

IJM Plantations boasts a total planted area of 61,277 hectares across Sabah and Kalimantan.

With the acquisition, KLK’s total oil palm planted area has risen by 28.7% to 274,688 hectares, from 213,411 hectares at end-September 2020.

KLK chief executive officer Tan Sri Lee Oi Hian said the acquisition is in line with the group’s long-term strategy of expanding its plantation business.

“As we are familiar with the areas in which IJM Plantations’ estates are located, we look forward to better integration of the combined group’s oil palm value chain.

“We are continuously looking at ways to improve our operating efficiencies with the aim of reducing our production costs,” Lee said.

IJM Plantations' share price settled up one sen or 0.32% at RM3.09, valuing the company at RM2.72 billion. KLK closed down 70 sen or 3.26% at RM20.80, giving it a market capitalisation of RM22.49 billion.

S Kanagaraju