KUALA LUMPUR, May 16 — Felda hopes that having top industry players as anchor investors for the upcoming US$3.3 billion (RM10.2 billion) listing of Felda Global Ventures Holdings Bhd (FGVH) will boost market confidence.
The key investors include French commodities group Louis Dreyfus, banking tycoon Tan Sri Quek Leng Chan and Tan Sri Chua Ma Yu, state-owned investment fund Permodalan Nasional Berhad (PNB) and the Employees Provident Fund (EPF), the Edge Financial Daily reported today.
The Edge also reported that Singapore's Fidelity and Hong Kong's Value Partners will help anchor the initial public offering (IPO).
Financial executives promoting the listing are banking on the list of prominent investors to attract the public in a volatile market.
"The reception was strong from potential cornerstone investors and this should help assure investors that the IPO will do well," a banker involved in the listing told the business paper.
Financial executives told the The Edge that Louis Dreyfus will receive a 4.9 per cent interest in FGVH, while the other key investors' allocations have not been finalised.
Quek will be placing a bid through a unit in his Hong Leong Group, while Chua will be expected to bid through his CMY Holdings.
Stockbroker BIMB Securities appears to be optimistic about the FGVH listing, saying that it is a "blue chip in the making", according to The Edge.
BIMB also projected that FGVH's may enjoy a 35 per cent increase in earnings based on higher crude palm oil prices.
However the Wall Street Journal yesterday reported that Felda's aging palm oil plantations would have a lower yield and hurt its future profits.
Alvin Tai, an analyst at brokerage firm OSK was quoted as saying that the average age of Felda's plantations is 20 to 25 years, a factor which could affect the federal land authority's profitability in the long run.
The WSJ also said a research note on palm-oil stocks published last month by Citigroup showed that Singapore-listed companies Golden Agri-Resources and Indofood Agri Resources Ltd. have a more “favourable” average plantation profile of 12 years.
Felda Global Ventures Holding's (FGVH) planned initial public offering is set to become the world's second-largest this year and the third-largest on record for Malaysia.
Putrajaya is currently forging ahead with Felda's controversial planned public listing despite criticism from some settlers and the opposition who claim that it will shortchange some 112,000 Felda settlers nationwide.
Prime Minister Najib has assured Felda settlers that the listing would yield profits, and has announced a RM1.69 billion windfall for all settlers and staff throughout the country, ahead of the FGVH listing.