KINIBIZ Tiger never tips a prey off if it is going to hunt it down. Or else the quarry will simply run away. A deer Tiger desires for its occasionally massive appetite never knows what hits it and before it does it is gone. Simple, right? But apparently it is not so for others, especially those who deal in the millions, sorry, billions of ringgit.
Take Koperasi Permodalan Felda Malaysia (KPF) which has agreed to sell all of its 51 percent stake in Felda Holdings to listed Felda Global Ventures Holdings (FGV) for RM2.2 billion cash. KPF is a cooperative owned by some 230,000 settlers and Felda group employees.
Felda Holdings is a giant of a company. It is the world's largest producer - not FGV or Sime Darby - of crude palm oil (CPO), accounting for 3.3 million tonnes of CPO, or 7 percent of world production in 2011. Its turnover is a massive RM19 billion and it employs directly 19,000 people.
Weekly business newspaper The Edge quoted the director-general of the Federal Land Development Authority (Felda) Faizoull Ahmad as having said that KPF will use the proceeds to buy a 10 percent stake in FGV and use the rest to pay some money back to the KPF members. He added that KPF had already bought some on the open market.
But hang on there! If you are going to buy a 10 percent stake in FGV, why announce it prematurely? Would not the share price start running even before you start to hunt for the shares? Why reveal that material information now and make it expensive to acquire FGV later?
Go to KiniBiz for the full article.
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