FGV shares rise in early session

KUALA LUMPUR: Shares of Felda Global Ventures Bhd (FGV) rose in the early session today with the company no longer pursuing its plan to acquire PT Eagle High Plantations. 

As at 10.20 am, shares of FGV were traded five sen higher at RM1.82 with 3.76 million units transacted. Yesterday, FGV said the group was in discussion at present with PT Rajawali Corpora for a possible different investment mode in PT Eagle High Plantations.

It added that current market conditions and developments in the palm oil sector had made it necessary to mutually review the existing investment mode to maximise benefits for all parties involved. 

"We believe the termination of the head of agreement is short term positive for FGV's shareholders. Had this deal gone through, it would further burden FGV's financials," said Maybank Investment Bank in a research note today. 

The investment bank added that at the purchase price of about US$17,400 per hectare, FGV would never have recouped its investment in Eagle High in the current planting cycle and at current crude palm oil prices.