Incorporation of a new Joint Venture Company - SPB PELITA Mukah 5 & 6 Sdn. Bhd.

We refer to our announcement dated 28 November 2007 in respect of a Joint Venture Agreement (JVA) between Pelita Holdings Sdn. Bhd. (PELITA) and Sarawak Plantation Berhad (SPB) for the development of land of the native held under Native Customary Rights (NCR) into oil palm plantations at Mukah 5 and 6 Mukah Division Sarawak. The said NCR lands contain a gross area of 5,446 hectares, more or less. The plantable area is estimated at 3,268 hectares.

The Board of SPB is pleased to announce that it had on 23rd October 2008, incorporated a joint venture company under the name of SPB PELITA Mukah 5 & 6 Sdn. Bhd. (the JVC). The JVC is jointly owned by SPB and PELITA with an initial authorised capital of RM100,000 and an initial paid up capital of RM2 comprising 2 ordinary shares of RM1 each and subscribed by SPB and PELITA. The principal activity of the JVC is plantation.

Under the JVA, the paid up capital of the JVC will be raised in stages based on the planted hectarage to RM7,843,200. The agreed percentage of shareholdings are as follows:

(a) PELITA shall own 10%
(b) SPB shall own 60%
(c) PELITA in trust for NCR owners shall own 30%

The incorporation is not expected to have any material effect on the earnings or net assets of SPB Group for the financial year ending 31 December 2008.

None of directors or substantial shareholders of SPB or persons connected to the directors or substantial shareholders of SPB have any interest, direct or indirect, in this incorporation.

This announcement is dated 23rd October 2008.