JAKARTA (REUTERS) - Indonesia's Rajawali Group said on Thursday it would want to hold at least 21 per cent of Felda Global Ventures Holdings if the Malaysian firm decides to seek a controlling stake in Rajawali unit PT Eagle High Plantations Tbk.
Felda, the world's third-largest plantation company, said this month that it plans to buy a 37 per cent stake in Eagle High for US$680 million (S$913 million) and will consider boosting that holding to a controlling stake.
The proposed deal has, however, been criticised, with analysts fretting that Felda has agreed to pay too much and may need to take on more debt to finance it. Shares in Felda have fallen 6 per cent since the offer was announced two weeks ago.
A Malaysian opposition lawmaker had also urged Felda, whose shareholders include Malaysian state funds, to abort the deal.
Rajawali will hold 2.55 per cent of Felda under the current plan but Managing Director Darjoto Setyawan told reporters that the holding would have to jump to 21 per cent if it was to cede control of Eagle High. "It can be a form of share swap," he said.
A 21 per cent stake in Felda would be worth US$360 million based on current market prices.
Felda did not immediately respond to an email seeking comment on whether it is open to a further share swap with Rajawali.
The deal would give Eagle High access to Felda's downstream capabilities while allowing the Malaysian firm to take advantage of Eagle's land bank, the companies have said, resulting in reduced operating costs.
Felda had approached Rajawali through a Malaysian bank, Mr Setyawan said. Several parties had expressed an interest in the Eagle High stake, but "from all the suitors, Felda is the most suitable and can have synergy with us," he said.
Rajawali is also selling its entire 21 per cent stake in infrastructure developer PT Nusantara Infrastructure Tbk and there have been five bidders from Indonesia and overseas, Mr Setyawan said.
Rajawali hopes to decide the buyer of the Nusantara Infrastructure stake by end-June or early July, he added.