Olam: confirms it will invest US$12m in a 60/40 strategic partnership agreement with the Gabon govt to develop a Special Economic Zone at Nkok for timber processing. Olam currently owns 400k ha of forestry concession for tropical hardwoods in Gabon, and as a govt partner, is eligible for additional concessions allowing it to further expand its timber processing activities there…
While deal is small, news is still positive, as this indicates that Olam is making progress in Gabon. We look forward to subsequent updates regarding Olam’s oil palm development projects in Gabon as well. We expect Gabon to contribute positively to Olam’s revenue base in future. Street mostly rates as Buy, with targets ranging from $2.17 to $3.29. Note upcoming FYJun10 results due 26 Aug after market close.
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