Louis Dreyfus confirms strategic partnership with FGV
UPDATED @ 02:02:38 PM 22-06-2012
KUALA LUMPUR, June 22 — Louis Dreyfus Commodities Asia (LDCA) today announced that it has reached a final agreement with Felda Global Ventures Holding Bhd (FGV) on the terms of their strategic partnership.
In a statement issued through FGV, LDCA said that all necessary approvals from it had been granted and the final agreement is still subject to approval from the Board of Directors for FGV's subsidiaries.
A memorandum of understanding was signed last month for LDCA to be a strategic investor and partner to enhance the marketing and trading of FGV’s palm oil business, according to a Bernama.
In acknowledgment of the strong result of the bookbuilding and demand for the FGVH offering, LDCA may reduce its participation in the enlarged issued and paid-up share capital.
The strategic partnership is a 'win-win' for FGV and LDCA where both partners will be able to tap each other’s strengths – FGV in its upstream and midstream activities and LDCA in its marketing and downstream capabilities – to create a major integrated player.
LDCA is a global leader in agricultural commodities, specialising in global processing, trading and merchandising, while FGV is a global agricultural and agri-commodities company which is also the world’s third largest plantation operator.
Meanwhile according to Reuters, Louis Dreyfus was taking a 0.5 per cent stake FGV as part of the Malaysian company’s US$3.1 billion IPO, as investors jostled for a piece of the sought-after offering, sources with direct knowledge of the plans said today.
Louis Dreyfus had previously considered buying up to 2.5 per cent in Felda, the world’s third-largest palm oil company by acreage. The sources were not authorised to speak publicly on the matter.
“Everyone was calling around for more shares, so where do you get it from? The company was more interested in having a partner than getting an investor (in the case of Louis Dreyfus),” said one of the sources. “2.5 per cent or 0.5 per cent doesn’t make that much of a difference.”