Nov 26, 2010

Tiga Pilar seeks US$90 mio for take over

PT Tiga Pilar Sejahtera Food Tbk (Plc) is preparing US$90 million to acquire 12,000 hectares of plantation areas in Sumatra following the company's plan to bolster revenues from the business.
Financial Director of Tiga Pilar Sejahtera Sjambiri Lioe revealed the company would allocate US$27 million in cash equities to complete the land acquisition, while the rest of the fund would come from banking loan from one foreign bank.
"We cannot yet tell you which land we will acquire. The negotiation is still running. We hope it can be finished by the yearend. For the time being, we can only tell you the loan comes from a foreign bank. Whether the loan is syndicated or not will depend on the bank," he said.
He added the MoU with the relevant parties was expected to be finished this year, while the entire acquisition process was targeted to be fully completed during February-March 2011.
Moreover, the company also planned to acquire a rice mill worth Rp150 billion. The rice mill has a daily production capacity of 200 tons.
"We hope the external acquisition process can be finished by the first semester next year. We are also making internal acquisition to establish a holding plantation company."
Regarding the internal acquisition, Sjambiri admitted the company was awaiting approval from PT Bank Mandiri Tbk as the creditor this week.
Once the state lender gave its approval, he added, Tiga Pilar Sejahtera would have a total plantation area concession size of around 80,000 hectares.
"At the moment, our concession area size is 13,000 hectares, 6,000 hectares of which are planted. After the acquisition, the size will grow to 80,000 hectares, with 39,000 hectares and 40,00 hectares of which are planted." 

Disclosure: No position at the stock mentioned above.  

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