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IT is exactly 100 days today since Felda Global Ventures Holdings Bhd (FGVH), the world’s second largest initial public offering (IPO) this year, was listed on Bursa Malaysia.

FGVH’s journey towards a listing has not been the smoothest. FGVH, as a high profile and politically-linked plantation conglomerate, encountered a myriad of challenges both internally and externally that on many occassions threathened to jeopardise its listing exercise.

Group president and chief executive Datuk Sabri Ahmad describes the FGVH IPO as quite successful if one were to take into consideration the snag in the unsuccessful listing of Facebook, the world’s largest IPO as well as the weak eurozone and uncertainty in the global economic outlook.

“You have admit that FGVH is no ordinary listing but we still went ahead with the listing. So against all odds, we hit the gong and thankfully the market has responded positively,” he says, when reminiscing on FGVH’s listing on June 28.

FGVH’s share price reached its highest premium of 80 sen on its listing day over the IPO price of RM4.55 per share. He maintains that the shares are still holding steady after being traded for more than three months.

“Of course, in between (like any other stock traded on Bursa) it did go down as low as RM4.57 but on that particularly exceptional day because the country’s rating was downgraded and overall Bursa was also quite weak.

”Personally, I believe the current performance of FGVH shares is not too bad and to still hold a premium which is above our IPO price is self explanatory,” adds Sabri.

He points out that the listing of FGVH is also historical as it puts the plantation conglomerate on the world map given its status as the second largest IPO in the world this year, which in turn reflects on Malaysia’s vibrant and resilient capital market.

After the FGVH listing, two other prominent IPOs follow IHH Healthcare Bhd which was recently listed and Astro Malaysia Holdings Bhd scheduled for Oct 19 listing.

It is recently reported that Bursa Malaysia has captured 21% of this year’s IPO listings in Asia Pacific driven by two top IPOs, FGVH’s US$3.3bil IPO in June and IHH Healthcare’s US$2.1bil IPO in July.

The big local IPOs have also established Malaysia as an attractive IPO destination.

Sabri explains further that the FGVH listing has set the stage for a full transformation of Felda Group‘s positioning. Felda was previously often associated with the government sector.

“Now FGVH has the opportunity to run the business like any other listed plantation company. In fact, I have already put in gain sharing with both the management and workforce so they are more motivated and incentivised.”

Commenting on what’s been said on the dismal performance of FGVH’s share price since listing, Sabri says; “As a plantation stock, one must bear in mind to look into its prospects for the next three years.

“A plantation stock is also not like a technology stock where one will see a significant jump. You must take a long-term approach particularly when we are most prone to the volatility in CPO prices amidst the current not-so-positive global economic outlook,” says Sabri.

However, he adds that in FGVH’s prospectus, the group has indicated that “we want to deliver at least 50% dividend annually from our net profit. We hope to keep this promise and expect dividends to stay good in the coming years”.

From the FGVH IPO, Sabri points out that the group has managed to unlock about RM10.5bil (US$3.6bil) in value, in which its principal shareholder Federal Land Development Authority (Felda) has received about RM6bil while FGVH takes up RM4.5bil for its expansion mission.

Of the RM6bil, Felda distributed about RM2.7bil or RM15,000 each to all 112,365 Felda settlers nationwide.

“While our detractors may close one eye to all these, what is important is Felda was able to unlock the value within Felda Group structure and distribute the income to settlers utilising the IPO proceeds and not money from the Government or the Treasury.

“Just imagine the RM2.7bil going into the country’s economy and multiplying many folds.

“Rural towns like Jengka, Temerloh, Jempol and Bahau are growing at least 10 times as major beneficiaries to the distribution of wealth from FGVH IPO,” he adds.

Many also fail to comprehend that FGVH is also sharing the wealth with others via Yayasan Felda. The foundation is now more aggressive in terms of reaching out to the small kampungs surrounding the Felda schemes.

Yayasan Felda is now helping out to repair dilapidated houses in the kampungs by handing out RM5,000 per house.

FGVH is also focusing on how to generate new jobs for the second generation of Felda settlers.

“We want to drive the existing Felda schemes to be the future growth centres for rural development in the country,” Sabri explains.

On market talk about the increasing foreign shareholding in FGVH, he points out that there is simply no truth in it.

He maintains that FGVH is still very much a Malaysia-owned company with more than 90% local shareholdings, while foreign shareholding is less than 8%.

Currently, FGVH’s biggest foreign shareholder is Qatar Holdings with 2.4% and the remaining are long-term investors.

The biggest shareholders are Felda which owns 20% of FGVH while Felda Asset Holdings Company SdnBhd has 17%,Lembaga Tabung Haji 7.78%, Employees Provident Fund Board 7.49%, Kumpulan Wang Persaraan (Diperbadankan) 6.93%, Pahang State Government 5% all making up 64.2% of shares. Meanwhile, Felda settlers own 2.5% and Felda staff about 3%.

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