Carson Cumberbatch regionalises oil palm investments

As part of a Group strategy to consolidate its oil palm plantation business in South East Asia under a regional plantation holding company, Carson Cumberbatch PLC transferred its majority holdings in four listed oil palm companies to its fully owned regional plantation holding subsidiary Goodhope Asia Holdings Limited.

The majority stakes transferred were those of Shalimar Malay PLC, Selinsing PLC, Indo Malay PLC, and Good Hope PLC, which were up to now held by Carson Cumberbatch (CCPLC). Carson Cumberbatch in turn will receive shares of Goodhope Asia Holdings Limited to an equivalent value, a media release from the company said.

These transfers do not constitute an effective change in the shareholding structure of these companies since these four majority stakes still continue to be held by a fully owned subsidiary of the Carsons Group.

The transfer was done with all approvals obtained by Carsons from the Exchange Control Department of the Central Bank of Sri Lanka, which permit the Group to hold its plantation linked assets through a regional base in Singapore. The transfers took place through the trading floor of the Colombo Stock Exchange (CSE) at current market prices.

In addition to the transfer of the majority stakes held by the parent company, smaller stakes of the oil palm companies held within some of the investment companies of the Carsons Group, namely Watapota, Weniwella and Mylands Investments were also transferred to Goodhope Asia Holdings Limited, through a similar trade on the CSE.

A group holding of shares in the Carsons property subsidiary Equity One PLC was also transferred to the parent company, as part of the same restructuring exercise.

This strategy would enable the Group to establish a stronger presence in the palm oil industry in its home base in South East Asia. The major industry players in the oil palm industry are based in Malaysia, Indonesia and Singapore.

Through its regional plantation company, Carsons would gain the opportunity to become a fully integrated player within the industry to support the expansion of its current plantation business base. The plantation business of Carsons covers an extent under cultivation of 80,000ha, crude palm oil processing capacity of 270MT/hr and infrastructure to support logistics and supply chain management.

The larger players within the industry have ventures in downstream processing and value added products which are a natural extension to the upstream business, once economies of scale are established.

A business base in the region would also permit Goodhope Asia to source strategic partners, financiers, buyers and suppliers with ease, thereby facilitating the rapid expansion of the business base and link up with industry groupings and policy forums related to the industry, the release said.