FAR EAST HOLDINGS BERHAD (“FEHB or the Company”)

Proposed Land Acquisition From The State Of ’s Land And Mines Office (Referred to as “Proposed Land Acquisition”)

1.0 INTRODUCTION

1.1 The Board of Directors of FEHB (“Board”) is pleased to announce that FEHB on 21 July 2011 has agreed to make payment of RM25,343,897 to the office of Pahang Director of Land and Mines for the Proposed Land Acquisition of 3,899.061 acres.

1.2 On 24 May 2011; FEHB had received a letter from Pahang Director of Land and Mines stated that the Pahang State Executive (MMK) had:

a) Approved the application for ‘Tapping Right’ to FEHB for the entire area of 1,577.894 hectares (3,899.061 acres) in Keratong in , Mukim Bera in Bera District and Mukim Bebar in with the respective areas approved.

b) Approved the application to grant land ownership title to FEHB for the entire area of 1,577.894 hectares (3,899.061 acres) in the Mukim Keratong in Rompin District, Mukim Bera in Bera District and Mukim Bebar in Pekan District with the respective areas approved for agricultural purposes (Oil Palm).

c) The approval for ‘Tapping Right’ will be void after the land titles are registered to FEHB.

1 2.0 DETAILS OF PROPOSED LAND ACQUISITION 2.1 Description of the Proposed Land Acquisition The Proposed Land Acquisition is located in the District of Pekan, Rompin and Bera and the detail location and hectarage is as per Attachment I. Currently the Proposed Land Acquisition is planted with oil palm plantations and some of the areas are located in the vicinity and adjacent to FEHB’s existing plantations.

2.2 Purchase Consideration The purchase consideration for the Proposed Land Acquisition is RM25,343,897 which is equivalent to RM6,500 per acre.

2.3 Basis in Arriving at the Purchase Price The purchase consideration for the Proposed Land Acquisition was arrived based on the amount of land premium payable to the State Authority for developed agriculture land (oil palm).

2.4 Original cost of the Proposed Land Acquisition As the Proposed Land Acquisition belong to the State Authority, there is no cost involved.

3.0 SATISFACTION OF THE PURCHASE CONSIDERATION 3.1 The purchase consideration for the Proposed Land Acquisition of RM25,343,897 (RM6,500 per acre) is to be satisfied by cash using the internal funds.

4.0 RATIONALE OF THE PROPOSED LAND ACQUISITION 4.1 The Proposed Land Acquisition is in line with the expansion plan by FEHB and would broaden FEHB’s income base. It is expected to contribute positively to FEHB’s future prospects and earnings.

2 5.0 RISK FACTORS AND FUTURE PROSPECTS 5.1 Risk Factors The Board does not foresee any material risk arising from the Proposed Land Acquisition except for the inherent risk factors associated with the oil palm industry for which the FEHB Group is already exposed to, such as business risks including but not limited to fluctuations in crude palm oil and palm kernel prices, weather conditions, pests and diseases attack on its crops, competition from other palm oil producers, dependence on key personnel and foreign workers and rising costs of labour and raw materials for its plantation and mill operations.

5.2 Future Prospects Going forward, the prospects of the enlarged FEHB Group with the Proposed Land Acquisition will largely depend on the prospects of the oil palm industry and its ability to sustain and improve its fresh fruit bunch yield. It will continue to identify opportunities to increase its landbank in order to expand its plantation operations so as to enhance its profitability. In the meantime, it will continue to pursue and evaluate horizontal and vertical business expansion opportunities deemed strategic to its business direction so as to increase shareholders’ value.

6.0 FINANCIAL EFFECT OF THE PROPOSED LAND ACQUISITION

6.1 Share Capital

The Proposed Land Acquisition will not have any effect on the issued and paid-up share capital of FEHB as the purchase acquisition will be fully satisfied by internal generated funds.

6.2 Substantial shareholders’ shareholdings

The Proposed Land Acquisition will not have any effect on the substantial shareholders’ shareholdings in FEHB.

3 6.3 Earnings

The Proposed Land Acquisition is not expected to have any material impact on the earnings of FEHB for the financial year ended 31 December 2011.

6.4 Net Tangible Asset (“NTA”)

The Proposed Land Acquisition will not have any material effect on the NTA per share of FEHB.

6.5 Effect On The Gearing There is no effect on the gearing of FEHB.

7. LIABILITIES TO BE ASSUMED AND SOURCE OF FINANCING

7.1 There are no liabilities, including contingent liabilities and guarantees, to be assumed by FEHB pursuant to the Proposed Land Acquisition.

7.2 The satisfaction of the Proposed Land Acquisition price will be funded entirely from the Company’s internal funds.

8. APPROVAL REQUIRED

8.1 The Proposed Land Acquisition is not subject to the approval of the shareholders of FEHB.

9. HIGHEST PERCENTAGE RATIO

9.1 The highest percentage ratio applicable to this transaction pursuant to paragraph 10.02(g) of the Bursa Listing Requirement is 2.68%.

4 10. EXPECTED TIME FRAME FOR COMPLETION

10.1 Barring any unforeseen circumstances, and subject to the approval of the relevant authority, the Proposed Land Acquisition is expected to be completed within six (6) months from the date of this announcement.

11. STATEMENT BY THE AUDIT COMMITTEE

11.1 The Audit Committee of FEHB (with the exception of interested Director in the Proposed Land Acquisition and/or persons connected therewith) is of the view that the transaction is: (i) in the best interest of the listed issuer; (ii) fair, reasonable and on normal commercial terms, and (iii) not detrimental to the interest of the minority shareholders.

11.2 The above view is made as the transaction is in line with the expansion plan by FEHB and would broaden FEHB’s income base. It is expected to contribute positively to FEHB’s future prospects and earnings and the financial performance of the enlarged FEHB Group is expected to improve over the longer term.

12. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTEREST

12.1 YH Dato’ Kamaruddin bin Mohammed and YH Dato’ Md. Adnan bin Sulaiman, are Directors of FEHB.

12.2 YH Dato’ Kamaruddin bin Mohammed is a Director of Lembaga Kemajuan Perusahaan Pertanian Negeri Pahang (“LKPP”). YH Dato’ Md. Adnan bin Sulaiman is a General Manager of LKPP and a Director in LKPP Corporation Sdn Bhd (“LKPP Corp.”).

5 12.3 LKPP and LKPP Corp. are substantial shareholders of FEHB. As at 30 June 2011; LKPP and LKPP Corp. holds 25.79% and 6.10% equity stake respectively in FEHB. LKPP and LKPP Corp. are Agencies connected to State of Pahang.

12.4 Hence, YH Dato’ Kamaruddin bin Mohammed and YH Dato’ Md. Adnan bin Sulaiman being interested directors have abstained and/or will abstain from any board deliberations pertaining to this Proposed Land Acquisition.

13. DIRECTORS’ RECOMMENDATION

13.1 The Board save and except for YH Dato’ Kamaruddin bin Mohammed and YH Dato’ Md. Adnan bin Sulaiman, having considered all aspects of the Proposed Land Acquisition, is of the opinion that the Proposed Land Acquistion is in the best interests of the Company and its shareholders.

14. DOCUMENTS FOR INSPECTION

14.1 The Letter from Pahang’s Director of Land and Mines dated 24 May 2011 is available for inspection at FEHB’s registered office at Suite 5 & 6, Tingkat 8, Kompleks Teruntum, 25000 Jalan Mahkota, , Pahang during normal office hours from Monday to Friday (except public holidays) for a period of three months from the date of this announcement.

This announcement is dated 22 July 2011.

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