Felda Global identifies foreign partners

This is written by my colleague in London, Zaharah Othman.


LONDON: FELDA Global Ventures Holdings Bhd (FGVH) has chosen heavyweights Louis Dreyfus Commodities Asia Pte Ltd and Vitol Group as its strategic partners in trading and logistics.

The agreements with the two global trading houses were signed during Prime Minister Datuk Seri Najib Razak’s working visit here yesterday.

The Prime Minister said the collaborations will help FGVH emerge as one of the world’s biggest and respected commodity companies. 

“We want FGVH to emerge as a commodity company that is among the biggest in terms of plantation to marketing,” Najib said.

Headquartered in Rotterdam, the Netherlands, Louis Dreyfus companies are present in more than 53 countries. 

While it has agreed to take a minority stake in FGVH, the trading giant said, this is conditional on a successful initial public offering (IPO) of FGVH at Bursa Malaysia next month.

Louis Dreyfus did not mention the amount of stake it would take up in FGVH but it was recently reported that this major global trader of cotton, grains, sugar, coffee and oilseeds, is likely to take up no more than 5 per cent. 

FGVH's public debut, slated for end-June, promises to be the world’s second largest IPO this year, after Facebook Inc’s estimated valuation of up to US$100 billion. 

“This strategic partnership with FGVH is a major step in Louis Dreyfus Commodities’ development in Asia. It spells a unique opportunity to cement its role as one of the largest integrated players in palm oil activities,” Louis Dreyfus said.

The proposed transaction involves both a strategic cornerstone investment in the IPO and the creation of two joint ventures, it added.

Meanwhile, FGVH and Vitol Group is set to establish a joint-venture company in Kuala Lumpur with the former as the majority shareholder.

"This strategic alliance between FGVH and Vitol is line with FGVH's growth strategy in energy trading. This is one of the channels for both upstream and downstream marketing that is intended to transform FGVH into a truly global player," said FGVH group president and chief executive officer Datuk Sabri Ahmad.

Vitol group president and chief executive officer Ian Taylor said: "This collaboration enhances our already significant presence in Malaysia, which is currently focused on our existing energy trading business and terminal operations."

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