Petaling Jaya Utara MP Tony Pua has warned Felda Global Ventures Holdings (FGVH), which has seen its share value decline by two-thirds, not to dive into another questionable acquisition.

He pointed out that FGVH last year proposed to acquire 37 percent of Indonesia-based Eagle High Plantation (EHP) for US$680 million or 775 rupiah a share and the EHP's share price closed at a mere 270 rupiah yesterday.

FGVH is also in limbo over whether to abort the acquisition EHP at three times the market price as it already paid a US$174.5 million non-refundable deposit.

"In another stunning announcement last week, before the dust over EHP has settled, FGVH is now proposing to acquire 55 percent of Zhong Ling Nutri-Oil Holdings Ltd for RM976 million.

"There are many questions arising from this particular transaction including the reason for FGVH to acquire a peanut oil company and variances arising from a complicated profit guarantee by Zhong Ling’s vendors," said Pua.

Zhong Ling is a company registered in Cayman Islands with interests in the Chinese market refining and distributing peanut and other edible vegetable oils.

Pua said more concerning, particularly for FGVH's shareholders which include state-owned funds EPF and Tabung Haji as well as 90,000 Felda settlers, is the fact the company FGVH is acquiring had failed to complete its audited accounts since December 2013.

"The failure to complete and table Zhong Ling’s financial audit for December 2014 or 2015 in a timely manner by a reputable international auditor is the clearest warning sign that all is not well within Zhong Ling.

"It gives the signal that Zhong Ling’s shareholders are seeking a profitable exit by disposing of the troubled assets to a company desperate to boost its earnings," said Pua.

He added that if the Zhong Ling is indeed financially sound, FGVH should request the company to first complete its audit before negotiating acquisition.

"Why must FGVH rush in headlong into the acquisition, bear the risk of an unaudited company backed by a highly questionable guarantee arrangement by Zhong Ling’s main shareholder.

"We call upon the board of directors of FGVH to protect the interest of the company’s shareholders by immediately terminating the acquisition.

"The deal should only ever be considered after Zhong Ling has regularised its audit short-comings, and even so, only if the latter allows a separate independent audit be carried out to verify the financial statements," he said.

Pua noted that the latest planned acquisition by FGVH comes amid lacklustre financial performance.

"The spate of acquisitions by FGVH should by right be earnings accretive, meaning they will add profits to the group.

"However, despite having used up all of its cash raised during the initial public offering in 2012, the more acquisitions it conducts, the less profits it makes.

"Despite its acquisition spree since then, FGVH net profits have tanked from RM1.33 billion in the financial year ending Dec 31, 2011 to a pitiful RM117 million in 2015," he said.