Last checked at 20 Jul 2020 09:21
M. P. EVANS GROUP PLC
("MPE" OR "THE GROUP")
A producer of sustainable Indonesian palm oil
Disposal of land
The Group is pleased to announce an agreement to dispose of 70 hectares of land in Malaysia for US$23.5 million, in line with the valuation published in its 2019 annual report. The proceeds will support investment in its Indonesian oil-palm projects.
Transaction details
The MPE board (the "Board") is pleased to announce that it has today entered into a conditional agreement to sell 70 hectares of land owned by Bertam Consolidated Rubber Limited, a wholly-owned subsidiary of MPE, to Bertam Properties Sdn Berhad ("Bertam Properties"), a Malaysian property-development company in which the Group has a 40% shareholding. The land is the remaining part of the Group's historic Bertam Estate which was not sold into Bertam Properties at the formation of the joint venture in 1992. Given the Group's long period of ownership, the land qualifies for a reduced rate of 10% Real Property Gains Tax in Malaysia on the profit from disposal.
The total sale consideration amounts to 99.9 million Malaysian Ringgit, equivalent at current exchange rates to approximately US$23.5 million. The sale consideration will be paid in cash over a three-year period, with a 10% deposit on signing the agreement lodged with the Group's solicitor; 50% of the consideration to be paid after satisfaction of the sale conditions including approval by the Malaysian Estate Land Board (expected to be by March 2021); a further 10% in January 2022 and the balance in July 2023.
This disposal is in line with MPE's strategy to realise its Malaysian assets for investment in new oil-palm projects. Following successful completion of the sale, the Group's sole remaining Malaysian asset will be its 40% shareholding in Bertam Properties, which will incorporate the land acquired from the Group.
Commenting on the disposal, chairman of MPE, Peter Hadsley-Chaplin, said:
The sale of the Group's last direct holding of Malaysian land is an important milestone in achieving our strategy. Bertam Properties will be able to add substantial value to the 70 hectares sold by developing it, and the Group will reap its 40% share of this benefit. The sale proceeds will underpin the Group's investment in expansion of both its hectarage and production facilities as a producer of sustainable Indonesian palm oil.
20 July 2020
Enquiries:
M.P. Evans Group PLC Peter Hadsley-Chaplin, chairmanTristan Price, chief executiveMatthew Coulson, finance director | Telephone: +44 (0) 1892 516333 |
Peel Hunt LLP (Nomad and joint broker) Dan WebsterGeorge Sellar | Telephone: +44 (0) 20 7418 8900 |
finnCap (Joint broker) Tim RedfernChris Raggett | Telephone: +44 (0) 20 7220 0500 |
Hudson Sandler (Financial PR) Charlie Jack Elfie Kent Francis Kerrigan | Telephone: +44 (0) 20 7796 4133 |