Felda Global Ventures Holdings Bhd. is buying a 37 percent stake in PT Eagle High Plantations for $680 million in cash and shares, the Indonesian company’s majority shareholder Rajawali Group said.
The deal includes 95 percent of conglomerate Rajawali’s sugar plantations, the company said in a statement in Jakarta on Friday. Rajawali’s managing director Darjoto Setyawan said this week it was seeking to sell an 18.5 percent stake in Eagle High.
Malaysia’s Felda wants to increase its core palm oil plantation business, expand trading operations and develop new markets, it said earlier this year. Indonesia is the world’s largest palm oil producer, followed by Malaysia.
Shares of Eagle High, with a market capitalization of 15 trillion rupiah ($1.2 billion), rose 11 percent by the mid session break in Jakarta on Friday, taking gains this month to 21 percent. Felda shares were suspended on Thursday in Kuala Lumpur pending an announcement, having fallen 5.6 percent this month.
Rajawali, one of Indonesia’s largest conglomerates, owns 65.5 percent of Eagle High, according to data compiled by Bloomberg. Eagle High, through its subsidiaries, has rights to a total area of about 419,000 hectares of land and plantations in Kalimantan, Sulawesi, Papua and Sumatra provinces in Indonesia, its website states.