Olam International has agreed to sell its remaining 50% stake in its Indonesian sugar joint venture (JV), Far East Agri, for approximately US$85 million to its JV partner, Mitr Phol Sugar. The latter is Thailand and Asia’s largest producer of sugar.
Mitr Phol already had 50% stake in the JV, and with the acquisition, will mean it has 100% ownership.
The latest divestment is in line with Olam’s 6-year strategic plan announced in 2019 to focus on businesses with sustainable growth potential, and divesting and/or restructuring de-prioritised assets and businesses. Olam aims to release US$1.6 billion in cash from de-prioritising and divesting 4 businesses namely sugar, rubber, wood products and fertiliser – and other assets that no longer fit with Olam’s strategic priorities.
In December 2017, Olam International formed a joint venture (JV) with Mitr Phol Sugar to capitalise on growth opportunities for sugar milling and refining in Indonesia.
Far East Agri operates sugar refinery PT Dharmapala Usaha Sukses in Cilacap, Indonesia and is currently developing a green-field sugar milling facility in East Java.
Olam to sell 50% stake in Indonesian sugar JV to Mitr Phol
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