MP Evans Group PLC (AIM:MPE), the UK-listed palm oil producer, has completed the purchase of two Indonesian plantation companies in a deal worth $35.1 million, as the group looks to boost output and expand its presence in East Kalimantan.
The acquisition, made through its subsidiary PT Evans Indonesia, covers PT Setara Kilau Mas Adicita and PT Sumber Bumi Serasi, both of which own oil palm estates planted since 2016.
The properties add a combined 2,750 hectares under direct ownership, along with a further 250 hectares managed for local smallholder co-operatives.
MP Evans said the new areas, which will be operated as part of the group’s Bumi Mas estate, are expected to deliver rising yields as the plantations mature. All production from the acquired land will be processed at the Bumi Mas mill.
The purchase price equates to $12,600 per group-owned hectare and was funded from existing cash resources.
An initial $22.5 million was paid at completion, with the group planning to repay $12.6 million of loans inherited as part of the deal.
The company expects the transaction to be immediately earnings-enhancing.
Matthew Coulson, chief executive, said the deal will bring the total managed area at Bumi Mas to nearly 12,000 hectares, with the group now overseeing some 70,000 hectares across Indonesia.
The acquired land will be registered under the Roundtable on Sustainable Palm Oil, consistent with MPE’s sustainability commitments.