CAB Cakaran buys land from subsidiary Farm’s Best for RM58 mil

KUALA LUMPUR (Jan 25): CAB Cakaran Corp Bhd is buying 118.98ha of agricultural land, along with 26 broiler farms, from its 53.04%-owned unit Farm’s Best Bhd for RM58.53 million.

In a filing with Bursa Malaysia yesterday, Farm’s Best said it had entered into nine agreements with CAB Cakaran for the disposal of 49 parcels of land located in Negeri Sembilan, Melaka and Johor.

Farm’s Best said the disposal is a continuation of its plan to eventually dispose of its entire poultry division to CAB Cakaran, except for the feed mill segment.

The properties’ market value amounted to RM57.17 million while the original cost of investment was RM48.56 million.

Farm’s Best said the disposals would result in estimated pre-tax profit of RM16.19 million.

The bulk of the proceeds from the disposal, equivalent to RM48.33 million, are slated for partial repayment of Farm’s Best’s bank borrowings, while RM10 million is for working capital and the remaining RM200,000 for expenses related to the proposed disposals.

The group expects the disposals to be completed by the first quarter of 2018.

This article first appeared in The Edge Financial Daily, on Jan 25, 2017. Subscribe to The Edge Financial Daily here.