Fraser & Neave (F&N) Holdings Bhd or F&NHB, a part of F&N Limited, has agreed to lease a parcel of land in Cambodia from Suvannaphum Investment Co., Ltd. for US$3.864 million ($5.2 million). The lease term will last for 50 years commencing on Feb 1 and ending on Jan 31, 2074.
On Feb 15, F&NHB, through its wholly-owned subsidiary, F&N Foods (Cambodia) Co., Ltd., entered into the lease agreement for the 32,200 sqm (346,597.92 sq ft) land at Suvannaphum Special Economic Zone at Samrong Kaer Village, Samrong Thom Commune, Kien Svay District, Kandal Province in Cambodia.
The land is currently vacant and is sited for industrial use. Based on its size, the consideration works out to US$120 per sqm.
Suvannaphum Investment Co was incorporated in November 2008 and is mainly engaged in the development of Suvannaphum Special Economic Zone, Suvannaphum Dry Port and Customs services, transportation and logistics services, river port services, and warehouses for rent. It is under the control of Charoen Sirivadhanabhakdi and the late Wanna Sirivadhanabhakdi, who are also the major shareholders of F&NHB.
F&N Foods (Cambodia) was incorporated on Feb 14 and will be mainly engaged in the manufacturing, sale, marketing, distribution, import and export of dairy products, beverages, confectionery and food products. It has a registered share capital of US$5.5 million comprising 5.5 million shares. Its sole director is Tiong Yean Yau, director, group finance of F&NHB. F&NHB is also the sole shareholder of F&N Foods (Cambodia).
According to F&N, the lease agreement was entered into for the group to set up a manufacturing facility for dairy products to strengthen the group’s presence in Cambodia.
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The total cost for the setting up of the manufacturing facility is estimated at US$37.5 million which includes the cost of leasing the land, construction of building and purchase of machinery. The manufacturing facility is expected to commence operations in the first quarter of 2026.
The consideration was arrived at on a “willing-buyer willing-seller” basis after taking into account the market value of the land, according to independent valuer Knight Frank, is US$3.865 million. The land was also deemed to be suitable for the F&NHB group’s manufacturing facility for dairy products in Cambodia.
The consideration will be paid with internal funds and no liabilities will be assumed.
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The transaction is expected to be completed in the second quarter of 2024.
Shares in F&N closed 1 cent lower or 0.93% down at $1.07 on Feb 15.
