PALM Panther Metals Plc

 

TIDMPALM 
 
RNS Number : 2471D 
Asian Plantations Limited 
30 November 2009 
 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO 
THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN 
 
 
news release 
 
 
30 November 2009 
 
 
ASIAN PLANTATIONS LIMITED 
 
 
FIRST DAY DEALINGS 
 
 
The Board of Asian Plantations Limited (the "Company"), a Singapore incorporated 
company established to act as a holding company with subsidiaries (together the 
"Group") involved in the acquisition, development, operation and management of 
palm oil plantations in Malaysia, is pleased to announce its admission to the 
AIM market of the London Stock Exchange ("Admission") and the first day of 
dealings in its ordinary shares under ticker symbol PALM. 
 
 
The Company has raised GBP5.26 million through a Company sponsored placing of 
7,010,000 new ordinary shares representing 23.7% of the enlarged share capital 
of the Company. The approximate market capitalisation of the Company at the 
subscription price is GBP22.18 million. 
 
Strand Hanson Limited is acting as nominated adviser in relation to the 
Admission with Mirabaud Securities LLP as broker. 
 
 
Overview 
 
 
The Group owns 4,795 hectares of titled and agricultural land, zoned for palm 
oil plantations in Sarawak, Malaysia (the "Sarawak Estate"). To date, the Group 
has spent approximately RM42 million (US$12.43 million) in respect of the 
acquisition and development of the Sarawak Estate. 
 
Following the arrival of the first seedlings at the nursery in April 2008 and 
the first planting of palm oil trees in April 2009, the directors of the Company 
(the "Directors") expect to have approximately 2,000 hectares of the total 
Sarawak Estate planted and developed by the end of 2009, with the expectation of 
revenue-generating harvests commencing in December 2010. 
 
 
In addition to the continued development and future operation of the Sarawak 
Estate, the Group has identified a number of potential acquisition opportunities 
which would increase the amount of land held for the development and operation 
of palm oil plantations. The Directors intend to complete at least one 
acquisition within six months of Admission and to pursue further opportunities 
to increase the plantable area to in excess of 20,000 hectares within two years 
of Admission. 
 
 
Key investment opportunity 
 
 
There is a significant valuation gap, on a per hectare basis, between the cash 
cost of land acquisition and development of palm oil plantations and the market 
valuations for mature businesses. The Directors believe mature palm oil 
plantations offer attractive cash flow generation, from which the Group is well 
positioned to benefit. 
 
 
The Directors believe the following characteristics of the Group are attractive 
to investors: 
 
 
  *  an opportunity to invest in a developing Malaysian palm oil platform at a 
  substantial discount to mature land valuations for similar publicly listed 
  companies; 
  *  the implicit valuation per plantable hectare of land held by the Group at the 
  time of Admission is RM23,311 (US$6,900). Institutional market research 
  estimates the value of the plantation business of comparable Malaysian palm oil 
  companies at between RM65,000 to RM100,000 (US$20,000 to US$30,000) per hectare; 
  *  the Directors have substantial experience in the palm oil industry, including the successful pioneering of advanced milling technologies for the processing of fresh fruit bunches ("FFB"), planting a top-rated palm oil estate in Malaysia and undertaking new planting projects;
 
  *  palm oil is increasingly in demand, driven, in part, by its relative low cost of production compared to other major vegetable oils and health benefits when compared to alternative edible oils;
 
  *  the palm oil market is undergoing a period of rapid change, with the growth of new biofuel markets resulting in a distinct increase in demand for vegetable oil products, and a commensurate increase in global palm oil prices. The Directors believe that there is potential for prices to rise further;
 
  *  the Group has access to land in Malaysia on which palm oil trees have already been planted, at a time of increasing competition for agricultural land;
 
  *  the Group has committed to comply with the environmental guidelines relating to sustainable palm oil planting practices. The Directors and major shareholders of the Group have experience with the Roundtable on Sustainable Palm Oil ("RSPO") application process and the Group is currently seeking to become a member of the RSPO. In addition to acting in accordance with the RSPO membership guidelines, the Directors intend to observe guidance from other environmental organisations or groups which the Directors believe promote the growth, trade in and use of sustainable palm oil; and 
 
  *  the Group intends to investigate the process of developing its own crushing mill, into which the Directors would incorporate methane recapture technologies. This technology has been tested and is eligible for carbon credits under the Kyoto protocol.
 
 
 
Commenting on Admission, Graeme Brown, Joint Chief Executive Officer, said: 
 
 
"Palm oil is expected to provide up to two-thirds of the growth in worldwide 
vegetable oil production over the next ten years. With strong growth in China 
and India, combined with health concerns surrounding trans-fatty acids in the 
developed markets, the outlook for the Group is exciting. The listing on AIM 
provides an opportunity for investors to benefit from these key drivers, while 
investing in the sector at a significant discount to its established peers. 
 
 
With the first FFB harvest expected within 12 months and further potential land 
acquisition opportunities available, the Group is well positioned to become a 
significant producer of palm oil in the short to medium term." 
 
Further information on the Company can be found at 
www.asianplantationslimited.com. 
Enquiries to: 
 
 
Asian Plantations Limited Tel: +65 9878 4171 
Dennis Melka 
 
 
Strand Hanson Limited Tel: +44 20 7409 3494 
James Harris 
Angela Peace 
Paul Cocker 
 
 
Mirabaud Securities LLPTel: +44 20 7878 3360 
Rory Scott 
Bankside Consultants             Tel: +44 20 7367 8888 
Simon Rothschild 
Oliver Winters 
 
 
NOTE TO EDITORS: 
 
 
 
 
Directors 
 
 
Executive Directors 
Graeme Brown, Co-Founder & Joint Chief Executive Officer, age 38 
Graeme Brown is co-founder of the Company. Prior to this, he worked for eight 
years at Keresa Plantations, where he remains the managing director, over which 
time he planted and managed a 6,000 hectare palm oil plantation. He is a 
specialist in plantation planting, palm species and plantation operations with 
over 10 years' experience in the industry. He also founded Keresa Mills Sdn Bhd, 
which has been a pioneer in the successful implementation of advanced milling 
technologies for FFB processing. 
 
 
Dennis Melka, Co-Founder & Joint Chief Executive Officer, age 36 
Dennis Melka is also co-founder of the Company. Prior to this, and since 2005, 
Mr Melka  was a private venture capitalist and has founded companies in 
Southeast Asia focused on limited service lodging, sustainable tree plantations 
and financial services. From 1995 to 2005, he worked in Credit Suisse First 
Boston's investment banking group. 
 
 
Non-executive Director 
Datuk Amar Leonard Linggi Jugah, Non-Executive Chairman, age 69 
Datuk Amar Leonard Linggi Jugah has over 36 years' experience in the business 
and legal sectors. He has served in a variety of political roles in Malaysia, 
including Minister in the Sarawak State Cabinet, Member of Parliament, appointee 
to the parliamentary Public Accounts Committee and until recently, Secretary 
General of Parti Pesaka Bumiputra Bersatu Sarawak. 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
 MSCDGBDBDGDGGCR 
 

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