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KUALA LUMPUR: PPB Group Bhd has proposed to dispose of 51% equity interest in PT Pundi Kencana for RM87.5mil cash.
In a filing with Bursa Malaysia, it said Mantap Aman Sdn Bhd (MASB), an indirect 100%-owned subsidiary of PPB held via FFM Bhd, has entered into a conditional sale and purchase agreement (CSPA) with PT Sentratama Niaga Indonesia (SNI) and PT Wilmar Nabati Indonesia (WINA) for the proposed disposal.
MASB will dispose of its entire 51% equity interest, comprising 257,397
shares in Pundi for a total sale consideration of 290.7 billion rupiah or RM87.5mil to be satisfied entirely in cash.
PPB said the consideration for the proposed disposal was agreed upon after considering the indicative market value of Pundi of 446.78 billion rupiah as appraised by an independent valuer, IHOT Dollar & Raymond in Indonesia; which took into account the net asset value of Pundi, as well as a discounted cash flow valuation of Pundi.
“The total agreed amount of 570 billion (RM171.6mil) on the value of Pundi’s shares is 28% above the indicative market value as determined by the valuer, of which the consideration is equivalent to 51% thereof, or RM87.5mil,” PPB said.
The group said the flour milling business in Indonesia is highly competitive. In the longer-term, a single stand-alone flour mill in Indonesia would not provide competitive advantage to the FFM group’s flour milling businesses from the market share and distribution efficiency perspective. The FFM group does not have any plans to expand the present operation in Indonesia
PPB said the acquisition of Pundi by the Wilmar group would enable Pundi to achieve greater operational and distribution efficiency, and benefit from synergies available in a larger group of similar businesses.
“The proposed disposal would provide an opportunity for the PPB Group to realise a gain on the investment in Pundi in cash. On completion of the proposed disposal, PPB would continue to share in the growth of the enlarged Indonesia flour milling business via its 18.78% interest in Wilmar,” it said.
