KUALA LUMPUR: SD Guthrie Bhd’s recent acquisition of 48% equity interest in Netherlands-based Marvesa Supply Chain Services (MSCS) for €54 million (or RM250 million) would allow the former to strengthen its presence in non-palm sectors.
In addition, SD Guthrie can tap into MSCS’s existing customer base for its certified sustainable palm oil products, which account for 12% of the global supply.
Public Investment Bank Bhd (PublicInvest) said MSCS could also tap into SD Guthrie’s strong presence in Southeast Asia’s palm oil industry through the deal.
To recap, SD Guthrie acquired a 48% equity interest in MSCS to penetrate into the European animal feed and biofuel industries.
“We believe this acquisition would help strengthen its presence in the European oils and fats industry. However, given the lack of financial information such as earnings and profitability of this company, we are unable to assess its impact on the group at this junction,“ PublicInvest said in a report.
The bank-backed research firm said the 48% stake was purchased from Parcom, a Dutch private equity firm, for €54 million while the remaining 52% stake is held by BGR Beheer B.V., which is owned by the current management of MSCS.
MSCS is a long-established industry player in the European market specialising in the sourcing, blending and distribution of oils and fats to the animal feed and biofuel industries.
The company has a diversified pool of customers in 11 countries comprising traders, distributors, and multinational feed producers.
It has a refinery based in Zwijndrecht with an annual capacity of 300,000mt.
The refinery produces a variety of oils and fats that are widely used for industrial frying, emulsifiers, bakery and confectionary ingredients, margarines, dairy products, candles, and milk substitutes.
In addition to the Netherlands, MSCS has a presence in Indonesia to meet the increasing demand for animal feed ingredients.
MSCS also has an established trading arm in lecithin, soy and other soft oils.
Meanwhile, PublicInvest said SD Guthrie’s Q4’24 results are expected to be released on Feb 27.
The research firm expects to see better results due to stronger CPO prices.
PublicInvest maintains a neutral call on SD Guthrie with an unchanged target price of RM4.85 based on 20x FY25 earnings per share.
