Boustead Plantations firms up land purchase for RM750m from Dutaland

KUALA LUMPUR: Dutaland Bhd unit's sale of its plantation assets in Sabah to Boustead Plantations Bhd for RM750mil has firmed up with the relevant sale and purchase agreement to be signed no later than 30 days from Friday.

Dutaland said on Friday its unit Pertama Land & Development Sdn Bhd had received a letter of acceptance from Boustead Rimba Nilai Sdn Bhd.

On Aug 22, Dutaland announced Boustead Rima had expressed its intention to acquire the plantation asset in Labuk and Sugut, Sabah totalling 11,579.31 hectares for RM750mil cash consideration.

The firming up of the purchase followed a due diligence exercise for 30 days from the date of receipt of Pertama Land's acceptance of the letter of intention.

Boustead, the purchase presented an opportunity to expand its land bank to complement its existing operations in Sabah.

With the sale of the 11,579 hectare tract, Dutaland would have now disposed of almost the entirety of its plantation land holdings.

According to its 2016 annual report, the group also holds mixed-development land totaling 3.47 acres with a net book value of RM354.21mil all of which are in Kuala Lumpur.

Recall that in 2011, IOI Corp had proposed to acquire a slightly larger tract of land of 11,978 hectares in the same location from Pertama Land & Development in a bid to bolster its plantation landbank. 

However, IOI Corp backed out of the RM830mil deal, citing "non-compliance of certain terms and conditions".