JAKARTA (TheInsiderStories) – Golden Agri Resources Ltd., (SGX: E5H), a Sinarmas Group business unit, declared has acquired two palm oil companies based in Labuan, Malaysia, said the company on Tuesday (11/24). The purchased have a total values of US$304 million.
The companies are Centrino Investment Ltd., with an acquisition values of $208 million and namely Woodside Financial Ltd., amounting to $96 million from an investment fund in Acsend Agri Fund Ltd. These corporate actions aimed to increase the cultivation assets and production of palm oil in Indonesia.
The director of Golden Agri, Rafael Buhay Concepcion Jr., commented “The acquisition transaction will be paid by paying off debts to Ocean Energy Holdings Ltd to our company.”
Last October, the company has established a new sugar unit, Golden Agri-Resources Brasil Sociedade Limitada Unipessoal (GAR Brazil), to enter Brazilian market. The parent, PT Sinar Mas Agro Resources & Technology Tbk (IDX: SMAR), has acquired the entire sugar business division of Singapore’ RCMA Group Pte. Ltd., on November 2019 to run the plans.
According to head of global vegetable oil & oilseeds Golden Agri, Paul Hickman, the plantation firm has identified trade opportunities in the sugar business, especially in South America. He added, ”Establishing a subsidiary in Brazil, which is one of the largest sugar exporting countries in the world, is a logical strategy.”
Apart from Brazil, the new entity also operates in Singapore and Netherlands, as part of food business diversification. Currently, the company manages palm oil plantations with a total planted area of 499,563 hectares in Indonesia.
In 2019, the unit of Sinarmas’ annual production was 21.5 tons of fresh fruit bunches per hectare. Their factories produce crude palm oil extract from the fruit kernel with a combined capacity of 13.4 million tons per annum. As of first half of 2020, the unit of SMAR, posted a revenues of $3.39 billion, or up 7 percent compared to the same period last year of $3.16 billion.
However, the issuer’ EBITDA was depressed 4 percent to $187 million from $198 million earlier. Golden Agri also booked net loss $157 million from last year $46 million. One of the triggers was the company’ sales volume was decreased by 7 percent also the CPO price which dropped significantly due to the pandemic.
Golden Agri is known as one of the largest oil palm plantation companies in the world. This cooking oil producer Filma manages oil palm plantations with a total planted area of nearly 500 hectares in Indonesia.
As of Sept. 30, 2020, the company posted revenues of $4.99 billion, up 6 percent compared to the third quarter of 2019 of $4.73 billion. Major contribution from the increased of the average selling price of palm oil.
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