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New Britain Palm Oil soars on news of Sime Darby takeover bid

New Britain Palm Oil saw shares race to the top of the Footsie leaderboard on Thursday as Malaysian group Sime Darby has made a £1.1 bn takeover offer for the firm
New Britain Palm Oil soars on news of Sime Darby takeover bid

New Britain Palm Oil (LON:NBPO) saw shares race to the top of the Footsie leaderboard on Thursday as Malaysian group Sime Darby has made a £1.1 bn takeover offer for the firm

Shares raced up over 74%  as the news of the all cash offer was announced.

The Malaysian giant is offering 715p a share for New Britain - that's an 85% premium to last night's closing price.

The New Britain board plans to unanimously recommend the bid to shareholders. The move will bolster the Malaysian conglomerate's position in Europe, where demand for sustainable palm oil is growing.

NBPOL is a large scale integrated industrial producer of sustainable palm oil in Australasia, headquartered in Papua New Guinea.

It has around 80,000 hectares of planted oil palm estates and more than 7,700 hectares of sugar cane and a further 9,200 hectares of grazing pasture; 12 oil mills; two refineries, one in Papua New Guinea and and one in Liverpool in the UK.

It also has a a seed production and plant breeding facility. 

Antonio Monteiro de Castro, chairman, said: "The offer will provide an opportunity for all shareholders to realise their investment in NBPOL at an attractive valuation and we also believe it represents a positive outcome for our employees, our customers and other stakeholders."

Broker Liberum rates New Britain a 'buy' following the news, targeting a price of 715p a share, saying it believes the offer was likely to be successful.

It noted that last week week Sime Darby had said it had not decided to proceed further on the proposed acquisition of New Britain. 

"We believe that Sime Darby made this new decision to proceed with the offer following the receipt of written confirmation from the PNG Prime Minister that the offer is not  contrary to PNG's national interest," said the broker.

DekelOil (LON:DKL) which operates a crude palm oil processing facility in Ivory Coast, saw shares rise over 7% on the news.

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