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KUALA LUMPUR (Jan 13): Sarawak-based oil palm planter Rimbunan Sawit Bhd (KL:RSAWIT) is disposing of a 1,504-hectare parcel of plantation land in Miri for RM28 million, cash, as it moves to exit the remote estate that has been weighing on its operating efficiency and profitability.
In a filing with Bursa Malaysia on Tuesday, the group said its wholly-owned Sastat Holdings Sdn Bhd had entered into a conditional sale and purchase agreement to sell the Sastat Estate in Batang Baram to Trinity Capital Resources Sdn Bhd.
The land was originally acquired in 2008 for RM30.8 million; its net book value stood at RM18.1 million as at Dec 31, 2024. Rimbunan Sawit expects to incur an estimated loss on disposal of about RM3.6 million on a pro-forma basis.
The group said the disposal would allow it to discontinue incurring high transportation costs linked to the estate’s remote location, which is not integrated with its other plantations and mills. The disposal would also enable it to avoid further capital expenditure required to turn the estate profitable, and to redeploy resources towards better-integrated and more profitable estates and mills.
The estate, held under a 60-year provisional lease expiring in 2068, has a planted area of about 1,055 hectares and recorded losses in recent financial years, according to the filing.
The RM28 million cash consideration represents a slight discount to the estate’s market value of RM29 million, as appraised by independent valuer Henry Butcher Malaysia (Sarawak) Sdn Bhd in its valuation report dated Dec 2, 2025.
Proceeds from the disposal, the group said, will be used for working capital, including transaction expenses, as well as for investment and development of other viable plantation estates within 12 months of receipt.
The disposal does not require shareholder approval, but is subject to consent from the Director of Lands and Surveys of Sarawak, and is expected to be completed in the second half of 2026.
Rimbunan Sawit shares closed unchanged at 18 sen on Tuesday, with a market capitalisation of RM367.5 million. The stock has fallen more than 18% over the past year.
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