M P Evans Share News (MPE)

(Sharecast News) - MP Evans announced the completion of its disposal of Bertam Estate, comprising 70 hectares of land near Penang Island in Malaysia, for $24m (£17.45m) on Friday.

The AIM-traded firm said the proceeds would support its continuing investment in sustainable Indonesian oil-palm projects.

It said the sale was made to Bertam Properties, a Malaysian property development company in which it owns a 40% shareholding.

Given its long period of ownership, the land qualified for a reduced rate of 10% real property gains tax in Malaysia on the profit from disposal.

The sale agreement, signed in July last year, was conditional, and all conditions had now been met, including Bertam Properties obtaining financing for the transaction.

MP Evans said the total sale consideration was MYR 99.9m, adding that a 10% deposit was received on signing the agreement, with a further 50% now paid on completion.

Of the remaining consideration, 10% would be paid in January 2022, and the balance of 30% in July 2023.

The disposal was in line with the company's strategy to realise its Malaysian assets for investment in new sustainable Indonesian oil-palm projects, the board said in its statement.

Following completion, its sole remaining Malaysian asset was its 40% shareholding in Bertam Properties, which would incorporate the land acquired from the group.

Bertam Properties was expected to add "substantial value" to the 70 hectares purchased.

"Completion of the Bertam Estate sale is an important step forward for the group, and the sale proceeds will support its continuing investment in sustainable Indonesian oil-palm," said chairman Peter Hadsley-Chaplin.

"This welcome, cash-generative, transaction further underlines the board's stated intention to recommend a total dividend of at least 30p per share in respect of 2021."

At 1144 BST, shares in MP Evans Group were down 1.54% at 848.74p.