THE Federal Land Development Authority (Felda) has set up a special committee to expedite the listing of its unit, Felda Holdings Sdn Bhd the country's largest plantation owner on the KLSE main board, possibly by early January next year.
A source close to Felda told StarBiz that the committee would be working closely with Aseambankers Malaysia Bhd, which has been appointed as the lead merchant banker and advisor on the initial public offering (IPO) exercise.
The source said: With the speedy deadline given by the government for Felda to get its KLSE main board status, it will be quite interesting to see the group's revamped structure as the process normally takes about two years for a big corporation like Felda to complete.
Second Finance Minister Datuk Dr Jamaludin Jarjis had recently said the government would retain 75% control in the listed entity, while 25% would be distributed among Felda's 105,000 settlers and 20,000 employees.
Proceeds from the IPO would be utilised by the government for development purposes. Settlers and employees of Felda, who through Koperasi Permodalan Felda (KPF) own 49% in Felda, would get an allocation of RM1bil, Jamaludin said.
According to the source, Felda's IPO would be tailored quite similarly to the listing of previous government owned companies that have been privatised, like Telekom Malaysia Bhd and Tenaga Nasional Bhd.
I expect more details on the flotation exercise to be unveiled by Felda chairman Tan Sri Dr Mohd Yusof Noor once he is back from his working trip in London before the end of this month, the source added.
Under the proposed IPO exercise, Felda Holdings is expected to acquire all estates owned by Felda for new shares in Felda Holdings. Felda Holdings will also acquire the equity interests in its subsidiary and associated companies directly held by Felda and KPF for new shares in Felda Holdings.
The equity interest in Felda Holdings will then be transferred to Minister of Finance Inc (MoF). Following this, the substantial shareholders in Felda Holdings MoF and KPF will offer Felda Holdings shares to retail and institutional investors. MoF will also offer some Felda shares to the settlers under a special scheme and state governments under a programme to be announced later.
Felda, to date, has a developed land bank of 811,140ha with three well-defined core businesses, namely plantations, palm industries and manufacturing.
There are 30 subsidiary and 12 joint-venture companies under its wings, operating locally and abroad.
Even before the government's announcement on the proposed listing exercise, Felda has been actively expanding its downstream activities and constantly looking at diversifying its existing operations, she added.
The source said Felda is well positioned to be a highly diversified group and is an ideal choice for big investors as plans are afoot to expand in big ways into herbs and mushroom cultivation as well as mixed property development.
Did you find this article insightful?