(Bloomberg) -- Johor Corp., a Malaysian state-owned investment firm, has picked banks for an initial public offering of its plantation unit, according to people with knowledge of the matter.

The investment arm of the Johor state government is working with advisers including RHB Bank Bhd., Affin Bank Bhd. and AMMB Holdings Bhd. on a domestic listing of Kulim Malaysia Bhd., the people said, asking not to be identified as the process is private.

CLSA Ltd. and CIMB Group Holdings Bhd. are also working on on the planned share sale of the unit, which could raise as much as 1 billion ringgit ($225 million), said the people. The operation could be valued at up to $1 billion in the offering, which could take place in Kuala Lumpur as soon as next year, they said. 

Johor Corp. asked banks for pitches for Kulim’s IPO last month as a rally in crude palm oil prices began to cool, Bloomberg News reported. While the commodity has fallen from its record high in March, it is still trading about 30% above its five-year average.

Deliberations are ongoing and details of the IPO such as the advisers, size and timing could change, the people said. 

Representatives for Affin, AMMB, CIMB, CLSA and RHB declined to comment. A representative for Johor Corp. and Kulim said the company is in the process of engaging external advisers and is unable to share further details at this point in time.

Malaysia hosted $451 million worth of IPOs so far this year, up from $423 million in the same period in 2021, data compiled by Bloomberg show. Kulim will be joining undersea cable installer OMS Group Sdn. in seeking a listing in Malaysia next year. 

Tracing its history to 1933, Kulim was listed on the the Kuala Lumpur stock exchange in 1975 and Johor Corp. became its major shareholder a year later, according to its website. The state-owned firm took Kulim private in 2016.

The agricultural company has 55,796 hectares of planted areas with oil palm trees in Malaysia and 7,362 hectares in Indonesia, the website shows. Along with plantation, Kulim’s core business areas are fruit and vegetable farming, livestock and trading and services. 

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