WCT and Bina Puri are among the more active contractors in Sabah over the past few years
KUALA LUMPUR: AmInvestment Bank Research believes Penninsular Malaysia-based construction companies may be invited for jobs in the Sabah portion of the Pan Borneo Highway project.
The research house said on Tuesday since there was a dearth of large Sabah-based contractors, “we do not preclude the possibility of seeing Peninsular-based counterparts being invited to set up JVs to bid for jobs”.
AmInvestment said apart from Suria Capital, which is mainly involved in port operations and property development, there appears to be no other listed Sabah owned contractors.
“Among the potential Peninsular-based players, WCT and Bina Puri are among the more active ones in Sabah over the past few years,” it said.
A 50:50 JV comprising the UEM group and MMC Corp has been disclosed as a 40% partner in Borneo Highway PDP Sdn Bhd (BHP).
BHP has been chosen as the project delivery partner (PDP) to undertake Phase 1 of the Sabah portion of the Pan Borneo Highway that will reportedly cost RM12.8bil.
Under the agreement, BHP will implement, supervise, manage and deliver the project as the PDP.
AmResearch highlighted in a sector update on April 4 (UEM, MMC among trio for Sabah Pan Borneo) that UEM, MMC and Warisan Tarang are teaming up for the Sabah portion of the Pan Borneo Highway.
Under the proposed agreement, privately-held Warisan Tarang is to have the lead 60% stake in the JV; the balance 40% will be equally shared between UEM and MMC.
Earlier, reports indicated that MMC and UEM were supposed to have a larger 30% stake each in the consortium, with 40% going to Sabah-based companies.
While the exact turns of the PDP structure remain unknown at this juncture, we understand that open tenders will be called where pre-qualified Sabah contractors will be invited to participate.
“We nevertheless believe it is still a tad premature to pre-empt the potential winners pending the finalisation of the JV and PDP structures. Near-term focus will remain with the Sarawak portion of the Pan Borneo Highway.
“With the polling date for the Sarawak state elections to be known by 14 April, it should galvanise investor interest in identifying the contractors for eight more packages worth over RM1bil each for the remaining 13 consortia that are still in the race.
“After Hock Seng Lee and Kim Lun’s wins for the earlier packages, we fancy KKB Engineering and Ikhmas Jaya’s chances as specialist contractors. Gamuda, IJM Corp, WCT and MRCB could also benefit,” it said.
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