Malaysia: Sime Darby says on track to list plantation, property businesses by year-end

Photo by Bethany Fankhauser on Unsplash

Malaysia’s Sime Darby Bhd, the world’s largest oil palm planter by land size, on Friday said it was on track to spin-off and list its plantations and property businesses by year-end, after restructuring that would create three standalone units.

Restructuring would involve reorganising borrowings and transferring assets within the group, Sime Darby said in a statement.

Sime Darby Bhd (SDB) also plans to settle inter-company loans by issuing new shares for spun-off entities, Sime Darby Plantation and Sime Darby Property.

Sime Darby Plantation’s loans owed to Sime Darby Bhd will be capitalised via an issuance of new Sime Darby Plantation shares amounting to 500 million ringgit ($117 million), while Sime Darby Property will issue new shares for 4.4 billion ringgit.

“As a next course of action upon completion of the above measures, Sime Darby Plantation and Sime Darby Property will seek admission into Bursa Malaysia. The new and more focused SDB will remain listed on Bursa Malaysia,” the conglomerate said.

Sime Darby announced its restructuring plan earlier this year. Its trading and logistics businesses would remain with the parent company that would retain its listed status.

Sime Darby’s plantations and property businesses accounted for nearly 70 percent of profit during the 2016 business year.

The company on Friday also said net profit for the fourth quarter ended June more than halved from a year earlier to 571 million ringgit on weak performance at its industrial and logistics businesses. Revenue grew 6.5 percent to 8.2 billion ringgit.

At a news conference, Chief Executive Mohd Bakke Salleh forecast Malaysia’s fresh fruit bunch (FFB) production for July-October to rise versus the corresponding period last year, before declining in the first quarter of 2018.

He said he expects Sime Darby’s FFB production to rise five percent on year for its fiscal year 2018.

“The group’s fresh fruit bunch production is expected to be stronger in the second half of 2017 compared to 2016, due to improved weather conditions,” Sime Darby said.

It said it expected crude palm oil prices of 2,500 ringgit to 2,700 ringgit per tonne and that improved production bodes well for the performance of the plantation division.

Benchmark palm oil prices were down 1 percent at Friday’s closing trade at 2,750 ringgit a tonne.

Reuters

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.