Palm oil producer MP Evans has acquired 8,350 hectares of plantations in Indonesia for US$60 million. The plantations belonged to PT Agro Bumi Kaltim (ABK) and PT Nusantara Agro Sentosa (NAS).
On September 7, MP Evans reported that PT Evans Indonesia is awaiting legal and regulatory formalities in Indonesia. The acquisition will be completed by the end of this year.
ABK and NAS own oil palm plantations in East Kalimantan and between them manage a total planted area of 8,350 hectares. MP Evans has 6,664 hectares in direct ownership. 4,973 hectares in ABK and 3,377 in NAS, plus 1,686 hectares managed by cooperatives.
Following the acquisition, MP Evans stated that it planned to send the entire ABK crop for processing at its mills on the group's Kota Bangun estate, while it would send the NAS crop to an external mill.
The group's chairman, Peter Hadsley-Chaplin, commented:
“The addition of the ABK and NAS properties to our portfolio… will bring our total area under management to more than 65,000 ha. “There is interest in acquiring hectares in Kota Bangun. ABK ownership supplying our plants improves our operational efficiency.”
Prospects for improving operations and commitment to sustainability
MP Evans said she was acquiring ABK and NAS from PT Palma Serasih Tbk.
According to the companies' audited accounts for the year ending December 31, 2022, ABK and NAS made full-year after-tax losses of US$3 million and US$2.6 million respectively.
Additionally, the group said it expected results to improve as the areas matured and that management would work to improve agronomic standards on both properties.
Following the acquisition, MP Evans said she would work to include the acquired areas as part of her Sustainable Palm Oil (RSPO) registration. In order to reaffirm its ongoing commitment to increasing the proportion of its certified sustainable production.
According to its website, London Stock Exchange-listed MP Evans owns palm oil plantations in five Indonesian provinces – North Sumatra, South Sumatra, Aceh, Bangka-Belitung and East Kalimantan – and also has an investment in a real estate company in Malaysia.
Its oldest plantations are in North Sumatra and Aceh, with newer projects developed in East Kalimantan, Bangka-Belitung and South Sumatra since 2005.
Source: Oils & Fats International
