Olam to divest 50% stake in Indonesian sugar joint venture for up to US$85 mil

Olam International has agreed to sell its remaining 50% stake in Indonesian sugar joint venture Far East Agri for between US$82.5 ($114.7 million) and US$85.0 million.

The total consideration is subject to final adjustments as provided in the sale and purchase agreement.

The divestment – to its joint venture partner Mitr Phol Sugar Corporation – will see Olam book a post-tax capital gain of approximately US$37.5 million to US$40.0 million.

Olam says the sale is in line with its six-year strategic plan announced in 2019.

The plan will see Olam focus on businesses with sustainable growth potential, as well as divest or restructure de-prioritised assets and businesses in order to release capital and redeploy to the prioritised businesses.

Assuming that the transaction had been completed on Dec 31, 2019, Olam’s net tangible asset (NTA) per share would have been lifted to $198.23, from $196.64 previously.

After the transaction, basic earnings per share (EPS) would have risen to 17.61 cents, compared to 15.98 cents prior to the transaction.

Source:theedgesingapore.com