UPDATE 3-Malaysia's Boustead Plantations to be taken private by KLK, top shareholders

(Adds details, share move)

SINGAPORE/KUALA LUMPUR, Aug 24 (Reuters) - Malaysian palm oil firm Kuala Lumpur Kepong Berhad said on Thursday it plans to buy a 33% stake in Boustead Plantations and eventually take over the smaller rival along with other top shareholders, in a deal valuing the company at 3.47 billion ringgit ($748 million).

The stake purchase and the takeover proposal represent an offer price of 1.55 ringgit per share, a 13% premium to Boustead Plantations' closing price on Wednesday.

KLK, as the company is known, will buy the 33% stake from conglomerate Boustead Holdings for 1.15 billion ringgit ($248 million), it said in a statement.

Upon completion of the stake purchase, KLK, Boustead Holdings and Malaysia's military pension fund Lembaga Tabung Angkatan Tentera - the top three shareholders of Boustead Plantations - will make a takeover offer for Boustead Plantations and delist the firm.

Shares of Boustead Plantations were suspended from trading on Thursday pending an announcement. They have gained 112.4% this year. KLK's shares were 0.9% lower after the announcement .

The deal comes as Malaysia - the world's second biggest producer of palm oil - is expected to take a hit to output from the El Niño weather phenomenon, which brings prolonged hot and dry weather. Palm prices are forecast to climb higher in the near term due to supply woes.

KLK said the purchase, due to be completed by the end of this year, will boost its earnings for the financial year ending September 2024.

"The proposed strategic collaboration is expected to ... further provide the KLK Group the long-term growth strategy for its plantation business," the company said.

RHB Investment Bank was KLK's principal adviser for the transaction.

($1 = 4.6400 ringgit) (Reporting by Yantoultra Ngui in Singapore and A. Ananthalakshmi in Kuala Lumpur; Editing by Sonali Paul, Kim Coghill and David Evans)