March 31, 2009

Controversial $190m BP acquisition going ahead: FHL

$190m BP acquisition going ahead: FHL - - 30/03/2009

Fijian Holdings Limited (FHL) has confirmed that the $190 million acquisition of BP SWP is going ahead.

And FHL managing director Sereana Qoro said the settlement of this acquisition would be made in a few weeks upon finalisation of overseas funding agreement.

She said this deal was not only the biggest but one of the most significant investment breakthroughs in FHL’s history.

“It has always been the desire of FHL to invest in the lucrative petroleum industry,” Qoro said.

“In fact, FHL participated a few years ago in the bid to purchase Shell Company in the early stages of the bidding process, which was eventually won by Total,” she said.

Qoro said this move was in line with FHL’s three year strategic plan to selectively grow its investment portfolio by expanding into the Pacific region.

She said the acquisition should also be a milestone for Fiji because for the first time, a major petroleum company operating in the Pacific would be locally owned.

She added this would have positive implications on Fiji’s foreign reserves in the long term.

Three major provinces in Fiji had questioned FHL’s move to acquire BP SWP saying the acquisition was too huge a deal for FHL’s size and that risks would be extremely high.

But FHL maintained that it could not go wrong with oil.

“The petroleum business is well established with 60 years of successful trading history, well integrated around six countries in the Pacific and highly profitable as a going concern,” Qoro said.

Qoro reassured shareholders that the investment in BP SWP Ltd met all the investment benchmarks that FHL had always used over the years.

Meanwhile, the Fiji Islands Revenue and Customs Authority (FIRCA) has issued a garnishee order against FHL for taxes owed by BP SWP.

BP SWP general manager Matt Elliott said the company was now inn discussion with the tax commissioner to resolve tax issues so to complete the deal with FHL.

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