KUALA LUMPUR: Boustead Heavy Industries Corp
Bhd (BHIC) announced that its subsidiary Boustead DCNS Naval Corp Sdn Bhd (BDNC) has received an additional letter of acceptance (LOA) for the extension of its submarine in-service support (ISS) contract, with a revised and final negotiation price.
The company said in its filing on Thursday that the LOA is in relation to BDNC providing ISS for two units of Prime Minister’s class submarines for the Royal Malaysian Navy (RMN) for 193 million euros (RM532mil) as announced in September 2014.
This is also with a further LOA announced on March 31, 2015 for an additional ceiling contract value of RM532.2mil to extend the ISS contract up to May 31, 2017.
BHIC said the additional LOA amends the extended contract, which will now have a value of RM153.16mil and 70.3 million euros, with a revised tenure to March 31, 2018.
The company added that both the ISS contract and the extended contract will have a material effect on the earnings of BHIC Group for the financial year ending Dec 31, 2015 and will contribute positively to future earnings.
“I am delighted our Group has been entrusted to deliver these additional services to the RMN, in preparation for the refit of such important naval assets. That work will also be undertaken by BDNC and is reflective of the strong relationship the BHIC Group enjoys with the RMN,” said BHIC executive deputy chairman and managing director Tan Sri Ahmad Ramli Mohd Nor.
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