Sime Darby buys Papua firm producing coconut and palm oil

KUALA LUMPUR: Sime Darby Plantation Bhd (SDP) announced that its wholly-owned subsidiary, New Britain Palm Oil Limited (NBPOL), has completed the acquisition of Markham Farming Company Limited (MFCL) for US$52.6 million (RM215.6 million) from Markham Agro Pte Ltd (MAPL).

In addition to this, NBPOL had also assumed the outstanding net debts of MFCL and MAPL totalling US$11 million, SDP said in a filing to Bursa Malaysia today.

The final purchase consideration and the eventual total cash outlay to be paid by NBPOL would be subject to the findings of a post-completion audit, it said.

MFCL is a private limited company incorporated in Papua New Guinea (PNG) which owns 6,110ha of agriculture land in Markham Valley, PNG.

The total plantable area is about 5,713ha, out of which about 4,018ha have been planted with oil palm to date.

MFCL also operates two copra mills in Buka and Madang, PNG, with a total combined copra capacity of 55,000 tonnes per annum.

MAPL is a private limited company incorporated in Singapore.

SDP said the oil palm plantation is well located close to Lae, PNG’s largest port, and has the ability to integrate with NBPOL’s existing supply chain.

MFCL is also the largest coconut oil exporter in PNG and the acquisition enables SDP to expand its lauric oils business into coconut oil production.

MFCL has become an indirect wholly-owned subsidiary of SDP effective Aug 23, 2018.