Sarawak tycoon Tan Sri Ling Chiong Ho is planning a major move into Wijaya
Baru Global Bhd. It is understood that the self-made businessman is attempting
to lock up Wijaya’s landbank in Indonesia.
Wijaya’s Indonesian asset is 80,000 hectares of virgin jungle land suitable for
planting palm oil.
It had bought the assets in 2011 for US$80
million (RM245 million). At east one of the public-listed companies controlled
by Ling had sent in proposals to help lock up the Indonesian assets.
The offer comes just after Wijaya’s
dominant stakeholder, Major (Ret) Anuar Adam was preparing for a corporate coup
that will benefit all Wijaya stakeholders. In 2011, Anuar bought a 32 per cent
stake in Wijaya from Datuk Tiong King Sing at 95 sen a share.
It is understood that Miri-based Shin Yang
group, one of Sarawak’s fastest growing
conglomerates, is proposing a venture with Wijaya, whereby it will bear the
entire cost of felling the virgin jungle as well as setting up an integrated
timber complex.
Wijaya currently has a felling licence from
the Indonesian government to cut down trees in the concession area before
converting the area into an oil palm plantation.
Under the proposal, Wijaya will have a
substantial stake in the integrated timber complex.
As for the trees felled, Shin Yang is
proposing to pay just under US$13 (RM40) for every 30 cubic meters.
Ling controls 55.03 per cent of the
public-listed Shin Yang Shipping Corp via the privately-held Shin Yang Holdings
Sdn Bhd. Shin Yang owns a fleet of 285 vessels, which helped ship some 1.36
million cubic meters of timber products. Shin Yang group, meanwhile, owns four
plywood mills in Miri, and is regarded as one of Asia’s
leading exporters of wood products.
Ling’s Sarawak Oil Palms Bhd, meanwhile, is
proposing a joint venture to help plant the felled jungle with palm trees, a
venture that could eventually cost some US$100 million (RM306 million).
He controls Sarawak Oil Palms via Shin Yang
Plantation Sdn Bhd, which has a 29.15 per cent stake in the public-listed
company. Additionally, Ling also has a 7.16 per cent direct stake in the
company.
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A corporate
exercise is in the making and if all goes as planned, Wijaya Baru Global Bhd may have more land as two
parties with land bank are in talks to buy out majority shareholder Datuk Anuar Adam.
Anuar holds 32%
equity stake in Wijaya Baru.
It was reported
that both have just finished the first round of negotiations. But all this is
subject to the board's approval as they have to ensure the interest of all
parties including that of the minority shareholders is taken into
consideration.
It is learnt that
one party is from the Middle East and the other is a listed company from Sarawak.
Anuar bought his
block of Wijaya shares from Datuk Tiong King Sing at 95 sen a share in 2011.
Those in the know
claim that the corporate exercise also involves a joint venture (JV) to set up
an integrated timber complex in Indonesia.
With the JV,
Wijaya's land base will increase from 80,000ha now located in Papua New Guinea and Indonesia
to 270,000ha because both the Middle Eastern and Sarawak parties have 150,000ha
and 40,000ha respectively near Wijaya's land bank in Indonesia.
How the deal will
be structured to include a JV is not clear at this juncture.
It was reported
that Wijaya had bought two companies Wealth Gate Pte Ltd and Suffolk Pte Ltd for about US$80mil. The two
companies have a combined 80,000ha that have been approved for oil palm
plantations and related activities.
Wijaya also has a
felling licence from the Indonesian government to cut down trees in the
concession area and will first extract timber from the forested land, before
converting the area into oil palm plantation.
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