SUNWAY Infrastructure Bhd (SIB), which is en route to a KLSE main board listing in the middle of this month, expects to turn in its maiden profit by 2006 with pre-tax earnings of RM1.43mil.
Upon listing SIB, a 50% subsidiary of Sunway Holdings Incorporated Bhd (SunInc), will become 33.3% owned by the group.
SunInc managing director Yau Kok Seng said SIB's wholly-owned subsidiary Sistem Lingkaran Lebuhraya Kajang Sdn Bhd (SILK), the concessionaire of the 37km Kajang Traffic Dispersal Ring Road, was expected to generate RM94.6mil in toll revenue in 2005 and RM110mil in 2006.
“The highway is 80% completed and will commence toll operations by August next year. We have projected the number of vehicles plying the highway to rise 20%-30% annually over the next three to five years from the initial estimate of about 44,000 vehicles daily,” Yau told a press conference after the balloting of SIB shares in Kuala Lumpur yesterday.
The concession period for the RM1.25bil highway was 36 years, he said, adding that the toll charges would be “very reasonable”.
He said the highway, running in one of the highest traffic-density areas in the Klang Valley, was the gateway to the rapidly growing Putrajaya-Cyberjaya-Sepang corridor. .
“We expect SILK to contribute about 15% to the SunInc group's bottomline by 2008, with its pre-tax profit increasing to RM24.45mil by then,” Yau added.
SIB deputy chairman Datuk Razman M. Hashim said the highway, which was conceived and implemented to alleviate traffic congestion in Kajang and the peripheral roads leading to and around the town, would also serve as a link to the strategic road network in the south-eastern part of the Klang Valley.
“It will also facilitate the development of areas along the road and contribute to a better standard of living for the residents,” he added.
For the listing exercise, SIB made a public issue of 52 million new ordinary shares of 50 sen each at an issue price of RM1.50 per share, of which 40 million were made available for institutional investors, 11 million for the public, companies, cooperatives, societies and institutions, and one million for directors and eligible employees of the SIB group.
For the public portion, 65,584 applications for 185,720,300 shares with a value of RM278.58mil were received, representing an over-subscription rate of 15.88 times.
For the bumiputra portion, 26,963 applications for 45,701,900 shares were received, an over-subscription rate of 12.85 times.
On SunInc's plans to take 63%-owned subsidiary Sunway Construction Bhd private, Yau said initial talks with some key minority shareholders had been very positive.
“We expect the exercise, a key part of SunInc's ongoing restructuring, to be completed by the end of June next year and to unlock value for SunInc and SunCon shareholders,” he added.
In the cash-and-share deal worth RM221.2mil, SunInc proposes to pay RM2.73 for each SunCon share – RM1.10 in cash and one SunInc share at RM1.63.
SunInc has also proposed the private placement of up to 10% of the issued and paid-up capital of the company.
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