Tradewinds in major palm oil deal in RI

Tradewinds in major palm oil deal in RI

KUALA LUMPUR (AFP): Malaysian-based Tradewinds (M) Bhd. is using a palm oil tie-up with Satia Dinamis Corporatama of Jakarta to expand its business in Indonesia, company officials said yesterday.

Tradewinds, listed on the Kuala Lumpur Stock Exchange under the consumer products sector, is taking a 56 percent stake in the joint-venture project to develop 15,000 hectares of oil palms on Bangka Island, Indonesia.

The project, the development of which is estimated to cost 100 million ringgit (US$40 million), is expected to generate revenue of 583 million ringgit ($233.2 million) over 25 years, company officials said.

"This marks Tradewinds' entry into Indonesia, which is chosen for the group's first venture in an oil palm plantation overseas in view of the higher returns made possible by lower development costs," said company secretary Rohaya Hashim.

Tradewinds, through its wholly-owned unit, Ladang Mawar Sdn. Bhd., will take up the 56 percent stake for Rp 2.38 billion or 2.86 million ringgit cash in the joint venture firm Sadin Tradewinds.

The balance will be held by Satia Dinamis Corporatama's subsidiary PT Sadin Multiagro Sentosa.

Sadin Tradewinds will initially be capitalized at 5.1 million ringgit and 20 million ringgit in eight years.

"Tradewinds is also actively exploring other areas in Indonesia, particularly in Sumatra, for expansion of its oil palm plantation as well as diversification into other sectors," Rohaya said.