Feb 25, 2011 (LBO) - Sri Lanka's Carsons group plans to buy minority stakes in its Malaysian oil palm units as part of a revamp to prepare for bigger investments and expansion outside the region, a statement said.
The group wants to buy minority stakes in its four Malaysian plantation companies, Shalimar (Malay), Good Hope, Indo-Malay and Selinsing, and delist them from the Colombo Stock Exchange, a CSE filing said.
The four firms are to be brought under Goodhope Asia Holdings, the Singapore-based holding company set up to own and manage the group's south east Asian oil palm investments.
Carson Cumberbatch and Bukit Darah, the main group firms, have made voluntary offers to minority shareholders of the four Malaysian plantation companies to buy their stakes.
In return, shareholders have been offered shares in Carson Cumberbatch and Bukit Darah.
Ownership of group company shares will enable shareholders to reduce the risk and volatility of plantation returns, the Carson statement said.
It will also enable them to benefit from the more diversified group businesses like beverages, investment holdings, leisure and real estate and get a more secure return, it added.
Goodhope Asia Holdings owns and manages over 80,000 hectares of oil palm plantation land bank in Indonesia and Malaysia "through which it is able to generate economies of scale, operational efficiencies and cost competitiveness," Carsons said.
"It has plans to further increase its plantations operations both within and outside Indonesia and Malaysia."
The combined holdings of the four Malaysian units are only 1,400 hectares.
Goodhope Asia Holdings, with a larger plantation assets base, "would be able to raise the required finances to undertake further expansion and development in the upstream plantations as well as integrate with industry value chain via downstream opportunities," it said.
Goodhope Asia Holdings "has the scale of operations to attract suitable joint venture and strategic alliance partners," the Carsons statement said.