Olam to suffer from Gabon fertilizer project delay

It'll have to wait until 2014.

According to CLSA, in its latest strategic review, Olam is now ushering in the dawn of a change in strategy where the focus will be on sustainable growth.

This will lead to reduced leverage ratios, lowered Capex, and more importantly, turn FCF positive by FY14 and into the future. The only fly in the ointment is that the Gabon fertilizer project will be delayed till CY14.

Here's more:

Nonetheless, these were key changes that we wanted to see Olam make, and having now steered the ship in the right direction, we shall await execution for affirmation.

Management indicates further delays in the Gabon fertilizer project, with financial closure to be achieved only in CY14. Mgmt also reiterate that Tata Chemicals remains obligated to commit to buying-in thereafter.

That said, Olam is looking for other investors to take a stake in the project and aims to reduce its own stake to <50% by FY16. Given the multiple project delays, we are concerned on Tata Chemicals will commit to the deal, and hence will look positively on any divestment of stake or new partner in the deal.

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia