MALAYSIAN giant Sime Darby has acquired a 58.7 per cent stake in London-listed New Britain Palm Oil (NBPO) after major shareholder Kulim Berhad sold its 49% stake into the takeover offer.

But the deal is not completed yet, with Sime Darby extending the closure date of its offer period to 20 January 2015.

The European Commission must clear the decision, with a delay in this process cited as the reason for the extension.

Sime Darby to snap up all NBPO shares on 9 October, making the offer after it received confirmation from PNG Prime Minister Peter O’Neill that it would not be contrary to the country’s national interest takeover laws.

Majority shareholder Kulim said at the time it would accept the offer subject to no superior offer being made.

The group acepted the offer on 18 November after a general meeting.

The deal was previously thought to have been derailed by news the government intended to up its stake in the producer from 18% to 30%, but Sime Darby has indicated it is happy to acquire a 51% stake in the company.

“For us having 51% in NBPO would be ideal,” The Star Online reported Sime Darby chief executive Mohammed Bakke Salleh as saying after the group’s extraordinary general meeting in November.

“This is good because we want to work with PNG government to grow the business,” he said.

“The process requires us to make general offer to all shareholders. After we acquire our stakes, we would work out something to up PNG government’s stake in NBPO.”

In a letter to shareholders Sime Darby indicated that it intended to exercise its rights to secure control of NBPO at the shareholder, board and management level.

“This is a significant milestone for Sime Darby. We are acquiring a low risk, well-managed, ongoing business concern that will add value to the group,” Mr Salleh said.

“It is not often that an opportunity such as this presents itself. The strategic fit between NBPO and Sime Darby Plantation is the key factor that will ensure the success of this deal.”

In a letter to shareholders, NBPO chairman Antonio Monteiro de Castro outlined why the offer should be accepted.

Mr de Castro wrote Sime Darby would be a strong partner, the offer was fair and reasonable, it offered a premium to current market price, and was supported by the Papua New Guinea government.

“The offer consideration of £7.15 per NBPO share is within the independent advisor’s fair market value range of £7 and £7.50 per share,” he wrote.

The offer is a 55.7% premium over the two-month volume weighted average share price.

Sime Darby has offered K28.79 for every share held to Papua New Guinean investors.

Sime Darby said the acquisition fits its strategy to expand its land bank, with the combined plantation area of the two companies to be nearly a million hectares.

“As a brownfield asset, NBPO will immediately contribute to the group’s earnings without the incumbent risks associated with greenfield expansion,” Sime Darby Plantation managing director Franki Anthony Dass said.

Sime Darby said NBPO’s two palm oil refiners in the UK and PNG would complement the company’s current downstream operations.