Harn Len is mainly engaged in oil palm plantations and property investment. The planting segment contributes nearly 99% of the group’s revenue.
PETALING JAYA: Harn Len Corp Bhd
’s RM54.7mil acquisition of 4,053 acres of plantation land in Rompin, Pahang, in a deal with Datuk Mohamed Nizam Mohamed Jakel is a strategic move by both parties.
The land is currently planted with pineapple and oil palm. “Only about 20% of the land has been planted. It is a synergistic deal as Harn Len has the plantation industry expertise and experience, and can ramp up the planting of the land,” a source close to Jakel Group told StarBiz.
Businessman Mohamed Nizam is Jakel Holdings Sdn Bhd’s chief operating officer.
The Jakel Group is engaged in textile retailing and manufacturing as well as property development.
“This deal is timely, as the pineapples are ready for harvest.
“Typically, pineapples can be ready for harvesting within 16 to 18 months, compared with oil palms, which take three to four years to produce fruits for harvest,” said the source.
StarBiz was also told that the Jakel Group had recently ventured into aquaculture industry through tiger prawn farming.
“The plantation and aquaculture ventures are attractive as they provide recurring income, are recession proof and play a part in the food security agenda of the country.”
Harn Len yesterday said the group had inked a proposed deal to buy Mohamed Nizam’s private unit Almal Resources Sdn Bhd which owns the rights to a 60-year lease of the plantation land in Rompin.
Meanwhile, upon the completion of the acquisition, Mohamed Nizam will emerge as a substantial shareholder of Harn Len with a 5.5% stake.
About RM32.8mil or 60% of the acquisition price will be paid in cash, and the remaining RM21.9mil or 40% will be via 31.266 million new shares of Harn Len issued at 70 sen per share.
In a statement, Harn Len said the deal would grow its land bank from 42,724 acres to 46,777 acres and contribute towards the earnings of the group, moving forward.
“Pineapple plantations typically have a shorter crop life cycle compared to oil palm plantations. This can generate accelerated revenue for the group and reduce its reliance on oil palm plantations,” it said.
Harn Len is mainly engaged in oil palm plantations and property investment.
The planting segment contributes nearly 99% of the group’s revenue.
To date, Harn Len’s land bank is mainly in Pahang and Sarawak.
The group has a 60-tonne per hour fresh fruit bunch oil mill in Sarawak, which will be upgraded to 90 tonnes per hour.
