REG - M. P. Evans Group - Acquisition

M P EvansAnnouncement

16/04/2025 11:00

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RNS Number : 2993F  M. P. Evans Group PLC  16 April 2025

M. P. EVANS GROUP PLC

("THE GROUP")
ACQUISITION OF ADDITIONAL 2,750 PLANTED HECTARES

M.P. Evans Group PLC, a producer of sustainable Indonesian palm oil, is
pleased to announce that its wholly owned subsidiary, PT Evans Indonesia, has
signed a conditional share purchase agreement to acquire the entire issued
share capital of two Indonesian plantation companies, PT Setara Kilau Mas
Adicita ("SKMA") and PT Sumber Bumi Serasi ("SBS"). Their two respective
plantations are located close to the Group's Bumi Mas estate and mill. Gross
consideration is expected to be approximately US$34.2 million, funded from
existing resources, plus a final adjustment to allow for other assets and
liabilities on completion and is subject to the finalisation of certain legal,
regulatory and other formalities in Indonesia, with completion likely to take
place in the third quarter of 2025.

The acquisition is entirely in line with the Group's stated strategy to add
further planted hectarage close to its existing operations. SKMA and SBS both
own oil-palm plantations in East Kalimantan, with a total planted hectarage of
2,750 hectares under direct ownership and a further 250 hectares managed on
behalf of associated smallholder co-operatives. The total crop from the areas
being acquired was 50,300 tonnes in the year to 30 June 2024. Those areas are
relatively young, having all been planted since 2016, and so the Group expects
yields to increase in future years. Following completion of the acquisition,
SKMA and SBS will be managed as part of the Bumi Mas estate, and all the crop
from both acquired properties will be sent for processing in the Bumi Mas
mill.

The Group is acquiring SKMA and SBS from PT Golden Land Gemilang, which is a
wholly owned subsidiary of Golden Land Berhad, a listed Malaysian company with
subsidiaries in the Indonesian oil-palm sector, as well as from Jeffrey
Lachmandas Mahtani and Maurice Maulana Situmorang, the respective minority
shareholders of SKMA and SBS. The acquisition will be funded from existing
cash resources and the purchase price equates to US$12,500 per Group-owned
planted hectare. It is expected that the acquisition will be earnings
enhancing for shareholders. Following the transaction, the Group will continue
to have a strong, net cash, balance sheet, enabling it to continue to review
opportunities for further growth.

As a responsible producer, and consistent with its approach to other
acquisitions, the Group will work to include the acquired area as part of its
registration with the Roundtable on Sustainable Palm Oil ("RSPO") in line with
its commitment to continue increasing the proportion of its output that is
certifiably sustainable.

M.P. Evans chairman, Peter Hadsley-Chaplin, commented: "Adding the planted
areas at SKMA and SBS will bring the total Group-managed area at Bumi Mas to
almost 12,000 hectares, enabling the Group to make a significant difference to
the profitable utilisation of the on-site mill. This is another step forward
in the Group's growth strategy, after which it will manage almost 70,000
planted hectares across its Indonesian projects."

This announcement contains information for the purposes of Article 7 of the
Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed
in accordance with the Company's obligations under Article 17 of MAR.

Enquiries:

 M.P. Evans Group PLC  Telephone: +44 (0) 1892 516333

Peter Hadsley-Chaplin, chairman
Matthew Coulson, chief executive
Luke Shaw, chief financial officer

 

 Cavendish Capital Markets (Nomad and broker)  Telephone: +44 (0) 20 7220 0500

Matt Goode, George Lawson (Corporate finance)

Tim Redfern, Harriet Ward (ECM)

 

 Hudson Sandler  Telephone: +44 (0) 20 7796 4133

Charlie Jack, Francis Kerrigan, Francesca Rosser

 

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