Ekovest joins Pan Borneo Highway project, JV work package worth RM2.1bil

Upgrading of rural stretches of the Pan Borneo Highway between the Suai district to Bintulu district in northern Sarawak in progress. Residents want those stretches near cities and towns to be given urgent priority. Stephen pic

KUALA LUMPUR: Ekovest Bhd will participate in the construction of the Pan Borneo Highway by entering into a joint venture (JV) with Miri-based Samling Resources Sdn Bhd to develop a 95.4km Sarawak stretch under a RM2.11bil contract.

In a filing with Bursa Malaysia, the Kuala Lumpur-based construction firm said its unit Ekovest Construction Sdn Bhd inked a joint venture and shareholders agreement with Samling Resources to jointly develop and upgrade the stretch from Semantan to Sg Moyan Bridge plus Kuching-Serian roundabout interchanges.

The stretch was reported to be the longest of the 11 stretches for the Sarawak portion of the toll-free highway under phase one. The work package was one of two Pan Borneo Highway packages clinched by Samling Resources last year.

Ekovest said a JV company, Samling – Ekovest JV Sdn Bhd, would be incorporated as the vehicle for the parties to undertake the implementation of the project.

Ekovest Construction will hold a 30% stake in the JV company while Samling Resources will own the rest. Based on this, Ekovest’s share of the contract value is RM633.8mil.

To give the size of the latest contract some perspective, Ekovest's total revenue for the last financial year ended June 30, 2016, was RM793.6mil.

According to Ekovest, the JV agreement represents an opportunity of both parties to co-operate and leverage on the strength and expertise of each other.

“Ekovest Construction has the experience, expertise and track record in providing technical expertise and procurement of construction materials and equipment to undertake the project whilst Samling Resources has the experience and expertise in providing management in liaison with sub-contractors and the state government in East Malaysia,” the company said.

Ekovest shares slid 1 sen to close at RM2.40 on Friday, with 1.46 million shares changing hands.