Genting Plantations unwinds deal with Elevance


  • Plantations
  • Wednesday, 12 Feb 2020

KUALA LUMPUR: Genting Plantations Bhd is taking back a 25% stake in a metathesis plant it sold to a US-based technology partner Elevance Renewable Sciences Inc in 2014.

The plant is an existing 200,000 metric tonnes biodiesel facility in Lahad Datu, Sabah.

Genting Plantations had planned to convert the facility into a high value palm oil derivatives producer using Elevance's metathesis technology.

"Elevance is undergoing a restructuring exercise and has informed Genting Plantations that it would not undertake any further capital commitment for the metathesis plant," the company said in a filing with Bursa Malaysia today.

The major shareholders of Elevance are Naxos and GENTING BHD, each holding 48.1% and 47.8% equity interest.

Genting Bhd is a major shareholder in Genting Plantations.

"It is in the Genting Plantations' best interest that Elevance exits as shareholder of Genting Biorefinery Sdn Bhd under the proposed transactions but to remain in the role of licensor for the metathesis license," it said.

Genting Plantations said that both parties have agreed to unwind the previous share sale and purchase agreement.

Under the deal, Genting Plantations will pay Elevance RM64mil for the stake after setting off RM8mil still owed by the US company under the original agreement.

Elevance, in 2014, had agreed to acquire the 25% stake in GIB for RM72mil.

"Upon completion of the proposed transactions, GIB will become a wholly-owned subsidiary of Genting Plantations and will continue to hold the metathesis license," it said.

This would allow GIB the flexibility to pursue the metathesis plant in future and to collaborate with other strategic partners to venture into higher value added product streams." US-based Elevance was founded in 2007 from work that was initiated by a grant from the US Department of Energy in 2004.

It is the first company to successfully bridge the renewables and chemicals industries, transforming natural plant-based oils, like soybean, rapeseed (canola) and palm, into specialty high-performance, cost-effective commercial products.


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Genting Plantations , Elevance , palm oil

   

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