Company Owned By Conglomerates Edwin Soeryadjaya And Sandiaga Uno Is Selling A Subsidiary That Has An Oil Palm Plantation In Agam, West Sumatra

JAKARTA - PT Provident Agro Tbk (PALM) has sold 100 percent of their assets, namely a subsidiary named PT Mutiara Agam (MAG). The company has an oil palm plantation in Agam Regency, West Sumatra.

Provident Agro and PT Saratoga Sentra Business as MAG's shareholders have signed a Conditional Sale and Purchase Agreement for the planned sale of 115,500 MAG shares on 22 September 2021. The buyers are PT Global Indo Bersaudara, PT Duta Agro Makmur Indah and PT Lambang Jaya Agro Perkasa .

"As of the date of this information disclosure, sellers and buyers are in the process of fulfilling the preliminary requirements with the target of implementing the planned transaction which falls no later than November 30, 2021," Provident Agro's management wrote in the prospectus, quoted Monday 4 October.

The share purchase price will be determined further by the parties involved in the sale and purchase. The planned transaction is based on MAG's enterprise value of Rp502.5 billion.

"The sellers will submit details of the purchase price of shares and the amount of debt repayment from MAG to PALM no later than 2 working days before the completion date of the planned transaction," said management.

PALM management considered that the sale of MAG shares was carried out with the consideration that this was a good opportunity to be able to provide optimal and reliable investment returns. The divestment of subsidiaries is expected to provide benefits and positive impacts for the company, stakeholders, and shareholders of the company.

MAG is a company engaged in the management of oil palm plantations and has been operating since 1982. Based on legal documents, MAG has a cultivation right of approximately 8,625 hectares (ha).

Of the total land-use rights, about 6,295.30 ha have been planted, consisting of 5,575.28 ha for mature plants and about 720.02 ha for immature plants. The plantation is located in Tiku V Jorong Village, Tanjung Mutiara District, Agam Regency. The company owns and operates a palm oil mill with a mill capacity of 30 tons per hour.

Considering that the sale of MAG's shares is classified as a material transaction, PALM will seek the approval of shareholders at the Independent General Meeting of Shareholders (GMS) on Tuesday, November 9, 2021.