Zecon secures RM595.5mil loan for construction of children’s hospital

KUALA LUMPUR: Sarawak-based Zecon Bhd has taken a RM595.5mil syndicated term loan facility for the RM606mil Hospital Kanak-kanak Permata it is building and operating in Cheras, Kuala Lumpur.

Under the 30-year Build, Lease, Maintain and Transfer concession it won from the Ministry of Education (MoE) and Universiti Kebangsaan Malaysia (UKM), Zecon – through its wholly-owned subsidiary, Zecon Medicare Sdn Bhd – has 54 months to build and complete the 243-bed children’s hospital. 

Actual construction of the hospital will be undertaken by South Korea’s Hyundai Engineering Co Ltd, which was awarded the contract by Zecon, with the signing ceremony taking place in Kuala Lumpur on Thursday, Dec 15.

“The project is expected to generate total gross revenue of about RM3.7bil over the concession’s operation period,” said Zecon chairman, Professor Datuk Dr Haron Ahmad.

Zecon beat out more than 10 other bidders in 2013 for the Public-Private Partnership Unit (UKAS) project tender by the Prime Minister's Department (JPM).

“Under this public-private partnership, we hope to offer advanced specialist paediatric services like those of the UK’s Great Ormond Street Hospital in London and Australia’s Westmead Children’s Hospital in Sydney,” Haron said.

The children’s hospital, to be located in Cheras, adjacent to Hospital Universiti Kebangsaan Malaysia (HUKM), will feature 54 units of step-down apartments in a nod towards medical tourism.

Haron said the aim of the hospital was to make Malaysia a centre of medical excellence in child care, similar to the way Institut Jantung Negara (IJN) is known for cardiac care. 

The new hospital will complement the existing paediatric services currently provided by the Ministry of Health and teaching hospitals of local institutions of higher learning, including Pusat Perubatan Universiti Kebangsaan Malaysia, Haron added.

The children’s hospital will cover an area of about 115,749sqm, and will have wards for paediatric cancer treatment and bone marrow transplants, as well as areas for play therapy.

Site clearing has been completed and Hyundai Engineering is expected to take over the site soon.

Affin Hwang Investment Bank arranged the RM595.5mil loan, with participation from Bank Kerjasama Rakyat Malaysia Bhd, Bank Pembangunan Malaysia Bhd and Affin Islamic Bank Bhd.

The loan comprises 80% of the project’s total funding of approximately RM744.4mil, including interest and other incidental financing costs. The balance of RM148.9mil will be via equity injection from Zecon Medicare.