The company says the proposed disposal of FGVCO is in line with its transformation plan to divest non-performing assets.
Divestment will help raise funds to reduce national debt and attract foreign fund managers.
Universiti Malaya's Terence Gomez says heavy government involvement in the sectors could be abused for patronage politics.
UM's Edmund Terence Gomez says the government must ensure that those taking over the stakes in GLCs have the capacity and financing to take the companies forward.
The news comes a day after GE agreed to sell its distributed power unit for US$3.25 billion to US buyout group Advent.
The Germany-based company will divest its entire vegetable-seed business.