KUALA LUMPUR: Sime Darby Plantation Bhd is edging closer towards exiting Liberia, having been approached by several parties who want to take over its loss-making oil palm operation there.
Its US$60 million asset in the African nation has been dragging the plantation giant's bottomline over the past years.
Late last month, executive deputy chairman and managing director Tan Sri Mohd Bakke Salleh said SD Plantation was reviewing its investment in Liberai and would decide within three months.
SD Plantation deputy managing director and chief operating officer for upstream business Mohamad Helmy Othman Basha yesterday said a review to re-evaluate the operations on over 10,000-hectare landbank in the country was almost complete.
He said the review would be presented to SD Plantation's board and then in the next annual general meeting within the next few months.
"Selling the asset is one of the options that we are looking at if we are to exit the country. Other option includes handing back the asset to the Liberian government," he said after the firm's session with investors at InvestMalaysia here.
According to its website, the estates in Liberia is managed by Sime Darby Plantation (Liberia) Inc.
The company signed a 63-year concession agreement with the Liberian government to develop 220,000ha of land in Grand Cape Mount, Bomi, Gbarpolu and Bong into oil palm and rubber plantations.
To date, 10,508ha has been planted in five estates namely Matambo, Grand Cape Mount, Zodua, Bomi and Lofa estates.
Out of the total planted area of 10,508ha, 10,401ha is planted with oil palm and 107ha is planted with rubber.
Helmy said the company had signed non-disclosure agreements with a few prospective buyers over the potential sale of the asset in Liberia.
"We are talking to a few potential buyers. They are those who are familiar with the region," he said.
SD Plantation is also looking at selling its other non-performing assets as it aims to unlock their value.
"It (the sale of other assets) is something that we are looking at. If it brings the desired return to the company, then we will proceed. What we aim for is creating value for our shareholders," he said.
Meanwhile, Helmy said SD Plantation will put more focus on its downstream business with an immediate target of 20 per cent revenue contribution to the firm.
He said the long-term target was to increase the contribution to 30-40 per cent.