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Friday, 21 April 2017 | MYT 11:28 PM

KL Sports City project's estimated cost trimmed by RM289mil

Workers put the finishing touches on the National Stadium, which is expected to be the firdt venue completed for the KL Sports City project. (Pic taken on March 30)

Workers put the finishing touches on the National Stadium, which is expected to be the firdt venue completed for the KL Sports City project. (Pic taken on March 30)

KUALA LUMPUR: The value of the contract given to Malaysian Resources Corp Bhd’s subsidiary Rukun Juang Sdn Bhd to undertake the Kuala Lumpur Sports City project has shrunk by RM288.6mil following a revision of the work packages.

In a filing with Bursa Malaysia, MRCB said Rukun Juang, the Government and Minister of Finance Inc’s unit Syarikat Tanah dan Harta Sdn Bhd (Hartanah) had entered into a second supplemental agreement on Friday following the signing of a supplemental agreement on Jan 29 last year.

To recap, last year’s supplemental agreement varied certain clauses in the privatisation deal that was inked on Oct 28, 2015. Among the changes were in the definition of “construction period for Project 1” and certain deliverables in relation to the fulfilment of conditions precedent and the construction works programme.

The upgrading and refurbishment of facilities at the National Sports Complex in Bukit Jalil consists of two phases (Project 1 and Project 2).

Under the privatisation agreement, Rukun Juang’s task under Project 1 is to refurbish, renovate and upgrade the National Stadium, Putra Stadium, hockey stadium and aquatic centre located at the National Sports Complex, as well as building the common infrastructures, including boulevard, parking, steps and new signage.

Project 2, meanwhile, involves the upgrading of the National Stadium (adding a retractable roof, retractable seats, comfort ventilation and track resurfacing) and the design and construction of a sports complex, sports mall, convention centre, a multi-storey car park, hostels, sports museum, library, and youth park.

Rukun Juang will be paid with three pieces of leasehold land measuring 92.5 acres near the sports complex, to be transferred from Hartanah.

In the latest statement, MRCB said following the first supplemental agreement, a land survey was carried out on the above lands and the Government decided to reduce the size of the lands by about 16.36 acres to 76.14 acres.

MRCB said Rukun Juang on Friday signed a second supplemental agreement with the Government and Hartanah to, among others, lower the contract sum from RM1.63bil to RM1.34bil. This was to correspond with the smaller land size and revised works packages.

An interesting change is the provisional values assigned to Projects 1 and 2. 

In the original privatisation agreement, Project 1 had been valued at RM499.2mil while Project 2 at RM1.1bil.

In the latest announcement, MRCB said the provisional cost for Project 1 was now RM1.035bil while that of Project 2 was RM131.3mil.

It added: “In the event that the Government decides not to proceed with Project 2, Rukun Juang shall pay to the Government the difference between the contract sum and the actual cost for Project 1.”

MRCB, through unit MRCB Land Sdn Bhd, owns an 85% stake in Rakan Juangh while the remaining 15% equity interest is held by Rasma Contractors Sdn Bhd.

In a separate filing, MRCB said Rukun Juang had incorporated Bukit Jalil Sentral Property Sdn Bhd on Friday for the purpose of owning the three parcels of leasehold land spanning 76.14 acres.

Tags / Keywords: Corporate News , Construction , Malaysian Resources Corp Bhd , Kuala Lumpur Sports City

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