Published July 7, 2009

Wilmar confirms China plans

By CHEW XIANG

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PALM oil giant Wilmar International yesterday confirmed media reports that it had hired three investment banks to 'evaluate' the feasibility of listing part of its China operations in Hong Kong but cautioned that there was no certainty that proposals would be carried out.

Mr Kuok: had said in May that a China issue could raise US$3-4 billion

Reuters news agency said on Friday, quoting unnamed sources with 'direct knowledge of the matter', that Wilmar hired BOC International, Goldman Sachs and Morgan Stanley to handle the offering, which could happen late this year or early next year. The sources said Wilmar could raise US$3 billion.

Investors piled into the stock yesterday, sending Wilmar up 22 cents or 4.4 per cent to $5.23 on volume of 11.8 million units. It traded as high as $5.26.

Yesterday, Wilmar confirmed that it had shortlisted units of the three named banks to evaluate a possible listing but said valuations are subject to many factors, including prevailing stock market conditions.

'As the proposed listing is still at an evaluation stage, shareholders are advised to exercise caution in trading their shares. There is no certainty or assurance as at the date of this announcement that the listing proposal and other related transactions (if any) will be carried out,' Wilmar said.

Chief executive officer Kuok Khoon Hong said in May that the company planned to spin off 20 to 30 per cent of its China business - where it holds a strong position in the consumer cooking oils market - in order to unlock shareholder value. Mr Kuok said then that a listing could raise US$3 billion to US$4 billion if the company was valued at 25 times earnings.