Emir to stay on?

Felda Global Ventures Group President and CEO Mohd Emir Mavani Abdullah.

PETALING JAYA: Felda Global Ventures Holdings Bhd (FGV) group president and CEO Datuk Mohd Emir Mavani Abdullah’s contract to helm the plantation group is likely to be renewed for another year, sources said.

It is learnt that Emir’s contract that ended last Wednesday was extended. Previously there was speculation that there would be a new person to lead FGV following scrutiny on the company’s performance and deals. FGV had yet to get back to query on the issue at press time.

FGV market capitalisation has halved since its Bursa debut back in 2012 and its latest proposed purchase of a 37% stake in Indonesia’s PT Eagle High Plantations for US$680mil on June 12 was criticised as being an expensive deal.

Emir has defended the Eagle High deal as FGV was paying a lower enterprise value (EV) at US$17,400 per planted ha, contrary to market talk that its purchase of Indonesia’s third largest listed oil palm planter was overpriced.

FGV pointed out that based on a comparative analysis, Sime Darby Bhd paid a higher EV per planted ha of US$25,900 for New Britain Oil Palm Ltd in 2014, while IOI Corp Bhd forked out an EV of US$23,500 per planted ha for Unico-Desa Plantations Bhd in 2013.

Emir was appointed to his position on July 15, 2013 under a two-year contract with an option to extend another year.

Lembaga Tabung Haji managing director and CEO Tan Sri Ismee Ismail was rumoured to replace Emir, according to news reports earlier this year.

Tabung Haji is the second largest shareholder in FGV, with a 7.78% stake after Federal Land Development Authority’s 34% stake in the company.

According to reports, Ismee, who is also a director of TH Plantations Bhd, was expected to have joined FGV this year.

Since it listing, FGV has struggled to replant its old plantations to reap better yield. It has been hiving off non-core assets to focus more on its operations in plantations.

Unfortunately, its operations was affected by the downward trend of crude palm oil prices.

FGV’s first quarter net profit plunged 98% to RM3.58mil from RM143.63mil a year ago.

The company, which derives more than 70% of its earnings from the upstream segment, is looking to improve cost efficiency and balance its business portfolio.