KUALA LUMPUR: KUB Malaysia Bhd
is targeting to dispose more than 4,600 hectare of plantation land and a mill in Sarawak to increase its cash flow.
KUB president and managing director Datuk Abdul Rahim Mohd Zin said that the group was currently in advance stage for the disposal.
“We will make an announcement in the next 2-3 months,” he told reporters at the sidelines after KUB’ shareholders meeting on Tuesday.
“The disposal will improve our cash flows situation especially we have bank borrowings on the mills, as well as reducing our losses,” he added.
The loss making firm has been disposing its non-core assets including some its investment properties and entire interest in food and beverage businesses A&W Malaysia.
Last year, KUB sold its entire stake in A&W Malaysia for RM34mil.
Abdul Rahim said FY18 was challenging year for KUB due to the slumped in crude palm oil (CPO) prices and a flood in Sarawak.
“CPO prices has plummeted from average of RM2,800 to RM3,000 per tonne to below RM2,000, which had caused a huge losses to our plantation sector,” he said.
“For Sarawak particularly, due to unfavourable weather, there was a flood. This has effected our operations and increased our productions cost,” Abdul Rahim added.
He said the oil palm mill was also facing difficulties to get adequate amount of fresh fruit bunches (FFB) due to low CPO prices that had increases competition