GMG

GMG: announces two new JVs to expand natural rubber processing capacity in the Ivory Coast.
i) JV with Mr. Joseph Desire Biley (JDB) to develop a 30k mt natural rubber processing factory in Aboisso. The initial sh/h proportion will be 75/25 split btwn GMG and JDB. It is intended that JDB will subscribe for further shares in the JV for each of the first 3 consecutive anniversaries such that the sh/h proportion becomes 60/40.
ii) to subscribe in new shares worth US$2.8m, for a 60% stake in Ivoirienne de Traitement de Caoutchouc (ITCA), which was established to undertake the operation of a 20k mt natural rubber processing factory in Dabou. Fonds Interprofessionel de Solidarite Hevea (FISH) will own the remaining 40%.
The investments will be funded from internal resources.
Earlier this wk, GMG’s subsidiary struck a US$410m deal with Cameroon’s govt to develop 45.2k ha of palm oil and rubber plantations.
Post rights, GMG has fallen by <20% since going XR.
The stock trades at 8.9x P/E, 1.4x P/B.