Kuala Lumpur Kepong Bergad Offer Update

On 25 October 2016, the board of directors of KLK, through its wholly-owned subsidiary, KLKI, announced the terms of a cash offer at 640 pence per share for MP Evans by KLKI to acquire the entire issued and to be issued share capital of MP Evans (the “Initial Offer”).
  —      The board of directors of KLK reiterates its belief that there is strategic merit in synergising the operations of MP Evans with KLK's from a geographical and capabilities perspective and that, together, KLK and MP Evans should establish best practices for the further growth of both companies and enable the enlarged group to capitalise on economies of scale in the oil palm sector.
  —      Noting the response of major shareholders to the Initial Offer, KLKI is pleased to present a revised offer.
  —      Accordingly, the board of directors of KLK, again through its wholly-owned subsidiary, KLKI, announces the terms of an increased cash offer for MP Evans by KLKI to acquire the entire issued and to be issued share capital of MP Evans (the “Increased Offer”). It is intended that the Increased Offer will be implemented by means of a takeover offer under the Code and within the meaning of Part 28 of the Companies Act 2006.   —      Under the terms of the Increased Offer, MP Evans Shareholders will receive:

   for each MP Evans Share                               740 pence per share in cash

 (the “Increased Offer Consideration”),
  representing a premium of approximately 74 per cent. to the undisturbed Closing Price of 426.25 pence per MP Evans Share on 24 October 2016, being the last Business Day prior to the commencement of the Offer Period.
  —      The Increased Offer Consideration values the entire issued and to be issued share capital of MP Evans at approximately GBP415.4 million.
  —      The Increased Offer is final and is not capable of being increased, save that KLKI reserves the right to increase the price per MP Evans Share payable pursuant to the terms of the Increased Offer in the event of: (i) a public announcement of the existence of a new offeror or potential offeror, whether publicly identified or not; or (ii) the recommendation of such an increased offer by KLK or KLKI by the board of MP Evans.
  —      The  Increased Offer is solely conditional upon valid acceptances being received in respect of MP Evans Shares which, together with any MP Evans Shares acquired, or agreed to be acquired, by KLKI and/or any other wholly-owned subsidiary or wholly-owned subsidiaries of KLK (whether pursuant to the Increased Offer or otherwise) carry, in aggregate, more than 50 per cent. of the voting rights then normally exercisable at a general meeting of MP Evans.
  —      Accordingly, MP Evans Shareholders should note that the Increased Offer will succeed if KLKI acquires, or agrees to acquire, control of more than 50 per cent. of the voting rights attaching to the MP Evans Shares, pursuant to acceptances of the Increased Offer or otherwise, and MP Evans Shareholders will receive the Increased Offer Consideration in respect of any MP Evans Shares assented to the Increased Offer.
  —      If KLKI acquires, or agrees to acquire, control of more than 50 per cent. of the voting rights attaching to the MP Evans Shares, pursuant to acceptances of the Increased Offer or otherwise (but less than 75 per cent. of the voting rights), then it intends to maintain the admission to trading on AIM of the MP Evans Shares.
  —      KLK continues to believe that its all-cash Increased Offer is highly attractive for MP Evans Shareholders, representing a compelling value proposition with a high degree of certainty at a substantial premium (see below) to the undisturbed MP Evans Share price, and that it provides a significant opportunity for MP Evans Shareholders to realise substantial value from their investment in the context of the low liquidity in the trading of MP Evans Shares.

   —      The Increased Offer Consideration represents a premium of approximately:

 o  77 per cent. to the volume-weighted average Closing Price of 417.4 pence per MP Evans Share for the 30 days ended on 24 October 2016, being the last Business Day prior to the commencement of the Offer Period;
  o  81 per cent. to the volume-weighted average Closing Price of 408.5 pence per MP Evans Share for the twelve months ended on 24 October 2016, being the last Business Day prior to the commencement of the Offer Period;
  o  74 per cent. to the volume-weighted average Closing Price of 426.0 pence per MP Evans Share for the three years ended on 24 October 2016, being the last Business Day prior to the commencement of the Offer Period; and
  o  16 per cent. to the Initial Offer Price of 640.0 pence per MP Evans Share.
  —      The cash consideration payable pursuant to the Increased Offer will be financed through a combination of an amended acquisition loan facility provided by The Hongkong and Shanghai Banking Corporation Limited and KLK's internal cash resources.
  —      HSBC, as financial adviser to KLK and KLKI, is satisfied that sufficient cash resources are available to KLKI to satisfy in full the cash consideration payable to MP Evans Shareholders (and participants in the MP Evans Share Schemes) in the event of full acceptance of the Increased Offer.
  —      KLK is incorporated in Malaysia and listed on the Main Market of Bursa Malaysia Securities Berhad with a market capitalisation of approximately RM 25.1 billion (approximately GBP4.6 billion) as at 14 November 2016, being the last Business Day prior to the date of this announcement. KLK was started as a plantation company more than 100 years ago and plantations still remain its core business activity.