UNLOCKING VALUE

SIME Darby Plantation Bhd is exploring the sale of a 25 to 49 per cent stake in New Britain Palm Oil Ltd, its Papua New Guinea arm. The planter has spoken with prospective buyers to gauge their interest in the minority stake, say sources.

SIME Darby Plantation Bhd is exploring a sale of a minority stake in its Papua New Guinea (PNG) unit, said people familiar with the matter.

Sime Darby Plantation had asked potential advisers for proposals on options for its New Britain Palm Oil Ltd subsidiary, according to the people.

The company was considering selling 25 per cent to 49 per cent of the business, said the people.

Sime Darby Plantation had spoken with some prospective buyers to gauge their interest in the stake, said one of the people.

In any deal, Sime Darby Plantation would seek a valuation for New Britain Palm Oil of at least US$1.7 billion (RM6.6 billion), the amount it paid when it acquired the company in 2015, said the people.

Any deal would add to the US$5.6 billion of announced acquisitions of agriculture-related companies in Asia over the last 12 months, data compiled by Bloomberg show.

Deliberations were at an early stage, and details of any potential transaction could change, according to the people.

Sime Darby Plantation could also consider other options for New Britain Palm Oil such as a re-listing of the business, said the people.

A representative for Sime Darby Plantation said the company’s priority was to create more value for shareholders from its existing asset portfolio, declining to comment further.

Sime Darby Plantation operates and manages 248 plantation estates and 72 palm oil mills in Malaysia, Indonesia, PNG, the Solomon Islands and Liberia, its website shows.

The company was spun out from Sime Darby Bhd last year.

New Britain Palm Oil owns 12 oil mills and two refineries, one in PNG and one in Liverpool, the United Kingdom, as well as a seed production and plant breeding facility.