KUALA LUMPUR, July 8 (Bernama) -- Felda Global Ventures Holdings Bhd (FGV) ill focus over the next 100 days, on expanding its upstream business.

Its President and Chief Executive Officer Datuk Sabri Ahmad more than 50 per cent of the net initial public offering (IPO) proceeds of RM4.1 billion, will be utilised for the acquisition of plantation assets.

"That's the key. We will expand our plantation estates, whether for greenfields or brownfields," he told reporters at the end of a two-day media tour to Felda operations in Perak, Negri Sembilan and Johor, recently.

In its prospectus, FGV said it is currently evaluating the expansion of its plantations in Southeast Asia and Africa at an estimated aggregate cost of RM2.19 billion.

On top of that, Sabri said the just listed entity will look closely at 40 initiatives it has identified to ensure all are implemented efficiently and systematically.

"The initiatives are to correct all the inefficiency that has been identified. It will be tagged along with proper Key Performance Indicators (KPI) and team leaders. My team will monitor and correct the result.

"The next 100 days is important to put (the initiatives) in place," he added.

To enjoy the economies of scale, Sabri said FGV may consider reducing its 149 estates to 100 by amalgamating the smaller ones into bigger entities.

"By having bigger estates, we can deploy the workers better, besides having better logistics control.

"We have been doing it and have so far collapsed 50 estates into 25," he added.

He said FGV will also consider reducing its 70 oil mills to 50.

"We may combine to make them bigger, running at 90 tonnes per hour. Those mills with a capacity of between 25 tonnes to 40 tonnes per hour are not so efficient in terms of economy of scale.

"All these have been studied carefully to ensure optimal utilisation of the milling capacity," he added.

Sabri said the focus for the next three-month period will also be for building talent.

"We will bring in new people with talent and who can contribute to new technology, innovation and creativity," he added.

FGV aims to be among the world's top five companies in the agro-based commodity business and to grow eight times its revenue and profit within eight years.

Some of the world's best companies are ADM, Bunge Ltd, Cargill, and Louis Dreyfus.

For the financial year ended Dec 31, 2011, FGV posted a pre-tax profit of RM1.372 billion on the back of RM7.474 billion revenue.

According to Sabri, FGV has started benchmarking itself with the best in class.

As for yield per hectare, he said FGV's target is to increase annually, one tonne per hectare, to achieve 23 tonnes in three to four years time.

"That's the KPI given to our plantation division," he added.

Currently, FGV's yield is 19.8 tonnes per hectare per year which is above the Malaysian average.

"The best in class may be 24 to 25 tonnes," he said.

As for the oil extraction rate (OER), Sabri said FGV's rate is among the best in the country.

"Our OER is 20.5 per cent. Our target is to increase one per cent every year. We can go to about 23-24 per cent in three years," he said.

Sabri noted that a one per cent increase of OER will translate into an extra RM80 million profit.

"How do we to get the extra RM80 million? Collect more loose fruit," he said.

Felda Jengka 21 has had the highest OER of 24 per cent for the last six months, making it the highest rate so far globally.