Napan Group acquires foreign plantation firm

Napan Group acquires foreign plantation firm

JAKARTA (JP): PT Pan London Sumatra Plantation (PLSP), an
affiliate of the Napan Group, acquired the North Sumatra
plantation firm PT PP London Sumatra Indonesia (Lonsum) from
Harrisons and Crosfield Holding BV for US$183.5 million
yesterday.

The agreement on the acquisition was signed in a ceremony in
Singapore yesterday, with Citicorp International Ltd., of the
United States, as lead arranger, with the Singapore branch of
Commerzbank AG of Germany and the Hong Kong branch of Rabobank
Nederland as co-arrangers.

The arrangers provided PLSP with $183.5 million in loans for
its working capital.

The acquisition facility is structured as a five-year
amortizing term loan with the source of repayment from the cash
flow of the acquired company.

"This financing structure is believed to be the first of its
kind in Asia," Citicorp told The Jakarta Post yesterday.

Citicorp said the five-year acquisition facility was well
received in the market and fully subscribed with 22 members in
the management group.

The acquisition of Lonsum, one the largest foreign-owned
plantation firms in North Sumatra, is considered to be a
strategic move by the Napan Group, to enter the food-based
industry. Napan Group is controlled by business tycoon Henry
Pribadi.

The new shareholders said PLSP plans to expand the operation
of its predecessor, Lonsum.

Lonsum currently manages over 56,000 hectares of land,
comprising of 20 agricultural estates. The company is engaged in
the cultivating, harvesting, processing and marketing of oil palm
and rubber products and to a lesser extent cocoa, tea and coffee.
(rid)