MP Evans invests in Indonesian oil-palm project

Sungkai Holdings, a subsidiary of AIM-listed MP Evans Group, has signed a sale-and-purchase agreement to buy Sunrich Plantations, which owns 95% of Indonesian oil-palm plantation owner PT Bumi Mas Agro (BMA).

The land is situated north east of Bontang in East Kalimantan and, including an associated smallholder co-operative, covers some 10,000 hectares. The contract is subject to the completion of regulatory formalities in Indonesia. MP Evans said soil conditions, vegetation, terrain and climate are "highly suitable" for oil-palm development.

The land to be bought by MP Evans comprises 8,240 hectares, 7,400 of which are young oil palms, planted mainly in 2012-16, and a further 400 hectares are in the course of being planted.

Chairman Peter Hadsley-Chaplin said: "'The acquisition of BMA marks another important step in the Group's strategy to expand the plantation hectarage under its control. MP Evans will bring its operating expertise to bear on this new acquisition, whose young palms can be expected to produce strong crop growth in the coming years. Crop growth underpins the Group's ambition to produce increasing volumes of crude palm oil and palm kernels at attractive margins."

A 1055 BST, the shares were up 0.7% to 740p.