Naza Group among companies bidding for contract for underserved areas
THE Naza Group, known for its automotive business, is among several companies bidding for a RM1.2bil telecommunication contract to develop and deploy communication facilities in underserved areas.
The contract, Time 3 Expansion (T3E), is under the purview of the by Malaysian Communications and Multimedia Commission’s (MCMC) Universal Service Provision (USP) fund. USP-funded projects are for development infrastructre and connectivity in underserved areas, especially rural areas.
According to sources, Naza Group, through its subsidiary Premium Radius Sdn Bhd, has submitted its proposal to the regulator earlier and the outcome is expected to be made known this month.
Industry officials say that the contract involves the erection of towers and provision of equipment in areas where there is no Internet or wireless infrastructure.
The entire T3E project is broken into several phases with each phase offering about RM600mil worth of jobs.
“The first phase with jobs worth RM400mil had already been awarded early this year,” sources tell StarBizWeek.
MCMC is expected to award the T3E phase 2 contracts totalling RM600mil together with phase 3 valuing at RM600mil later this month.
“All tenders for phase 2 and 3 have been closed. The combined value of phase 2 and 3 is RM1.2bil,” sources say.
It is learnt that the selection process is stringent because some of those awarded jobs in the first phase had not performed up to the mark.
Towards this end, Industry sources point out that the MCMC recently conducted a major audit on previous licensees which working on the previous T3E.
“The audit reveals that the performance of some of the licensees are below average or unsatisfactory,” says a source.
As at July 27, there are 196 network facilities provider individual licence registered with the MCMC.
The current MCMC management, headed by Datuk Seri Dr Halim Shafie, has put in stricter requirements, sources note.
Halim’s team has put in stringent evaluation criteria for awarding contracts and made it clear that underperformers would not be awarded. MCMC, sources say has adopted a very transparent tender process.
MCMC is looking for capable licensees with strong financial and technical backing. In addition, the licensee awarded the new contracts should be a neutral party for telcos to share their infrastructure needs.
“They want bona fide company who can deliver with proper project timeline and financially strong. What MCMC is doing is to look for companies with capabilities to carry out this project,” a source says.
The regulator has been making a serious effort calling operators to share infrastructure.
There is also talk that the role of chairman and CEO of the regulator will be decoupled to further enhance transparency.
StarBizWeek reported that the industry hopes that the management and usage of the USP fund is transparent so that the players themselves know where their monies are going.
The players have been investing, but the need for common infrastructure in remote areas can help prevent over-building and over-investing by all parties.
At the end of 2013, the USP fund is worth RM7.4bil.
Every year, telecoms players fork out 6% of their earnings towards the fund.
As at end-2013, a total of 5,802 USP projects have been implemented including 424 1Malaysia Internet Centre, 4,679 1Malaysia Wireless Village and 699 of Time 3 towers. A total of 1.11 million 1Malaysia Netbook have been distributed nationwide during the year.
Meanwhile, Naza Group has been aggressively bidding for various engineering and property projects, which the automotve group wants to develop into a new business unit.
“It has employed more than 30 engineers and currently working on projects in the telecommunications business. The clients include housing developers and state governments,” says a source.
The group was recently reported to be shortlisted for the project delivery partner role of the RM9bil light rail transit line three (LRT3). The award of LRT3 is expected to be announced within this month.
The group’s Premium Radius is not a newcomer into the industry. It is a registered networks facilities provider with the MCMC. The company, established in 2009, is a specialist Information Technology and Telecommunications Services provider.
It has an orderbook of 235 telestructures. Premium Radius is also Kedah’s exclusive state collaboration partner for telecommunication structures and has exclusivity in micro cell coverage with Kuala Lumpur City Hall (DBKL). It also manages the fibre optics and broadband management of several properties including the Platinum Park and KL Metropolis.