The strategic venture partnership between Felda Global Ventures Holdings Bhd (FGVH) and commodities giant Louis Dreyfus was a closely calculated decision that considered all political and economic factors, said FGVH president and CEO Sabri Ahmad.

The decision was reached after FGVH concluded that the French private holding company could synergise best with Felda's operations, Sabri told Bernama in an interview here yesterday.

"Felda is strong in its up- and mid-stream activities. We are confident that the strategic venture partnership with Louis Dreyfus will enhance our downstream capabilities," Sabri said.

Louis Dreyfus is involved in agriculture, oil, energy and commodities, specialising in global processing, trading, merchandising, as well as international shipping.

Margarita Louis-Dreyfus, the Russian wife of the previous chairman, is the current chairman of Louis Dreyfus Group and the largest shareholder via the Family Trust with a 65 percent stake in the parent Louis Dreyfus Holdings.

The day-to-day operation is run by Serge Schoen, a German.

The global entity has had dealings in the past with many countries with Muslim-majority populations.

The commodities unit generated 62 per cent of the holding company’s 2010 revenue and about 80 per cent of its US$892 million profit.

Today, 30 percent of the rice market in Africa and 10 per cent of grains requirements in the Middle East and Africa is supplied by Louis Dreyfus, indicating an open partnership with both Muslim and non-Muslim countries.

These avenues will be opened up for Felda to exploit following the agreement which was inked on Monday.

The firm, founded in 1851, also has an established presence in Organisation of Islamic Cooperation (OIC) member states.

Their commodities division has registered offices in Indonesia, the United Arab Emirates and Egypt.

"We clearly see their role purely as providing commodities including food to the global population.

"As a Malaysian firm, we must aim for a more globalised outlook and engage aggressively in global trade. This partnership will immediately open up new markets for our business expansion," Sabri said.

FGVH second largest IPO this year

FGVH is preparing to sell shares in what promises to be the world's second-largest initial public offering this year after Facebook, which was launched yesterday.

Asked about the enormity of FGVH's IPO, Sabri said it was best "to remain modest about it".

"All we want now is to remain focused on achieving the best deals and to always keep in check the interests of our settlers," he added.

Louis Dreyfus said on Monday it agreed to take a minority stake in FGVH, adding that it was conditional on a successful June stock market float.

It was reported that the firm will likely take a 2.5 percent stake, worth close to US$150 million.

- Bernama