Status quo for PLUS


  • Corporate News
  • Thursday, 16 Jan 2020

PETALING JAYA: Khazanah Nasional Bhd and the Employees Provident Fund (EPF) will keep their hold of PLUS Expressways Bhd in view of reworking the toll agreement of the concessionaire with the government, said reports.

It was reported that the government has agreed to the restructuring of the tolled highways with a reduction in toll rates but with an extension of the concession period.

The government had not released an official statement on its decision but various news outlets had reported the outcome of the Cabinet decision.

Finance Minister Lim Guan Eng said this matter had been discussed in the Cabinet meeting yesterday and that an announcement would be made soon.

At press time, there had been no announcement on the matter, with Lim declining to say as to when the statement would be issued, when asked by reporters.

In October, both the UEM Group and the EPF, which are the shareholders of PLUS Expressways, had proposed a cut in toll fees for the highways.

UEM is a wholly owned unit of Khazanah and has a 51% stake in PLUS, with EPF owning the remaining 49% of PLUS.

Pursuant to this development, there is also uncertainty as to whether the privatisation of Gamuda Bhd’s intercity tolled roads such as the Damansara-Puchong Highway (LDP) would proceed as earlier planned.

Shares of Gamuda, which had initially traded at near the RM4 mark, had fallen late evening yesterday on these latest developments.

Gamuda fell by 9 sen at the end of the day yesterday, with 10.19 million shares changing hands.

Gamuda still appears to be holding its gains after the announcement for the takeover of its highway assets was made in June 2019 and trades near that level.

Meanwhile, UEM Edgenta Bhd, which is the maintenance contractor for PLUS Expressways, saw its shares gain some interest from the market instead.

Edgenta shares rose 1 sen to RM2.78, with 22,700 shares changing hands.

Edgenta managing director and chief executive officer Datuk Azmir Merican earlier told StarBizWeek that it provided for about 50% of the maintenance work for the highways under PLUS.

“The rest of another 50% is tendered out to other parties, ” he had said in an interview then.

Meanwhile, despite an approval for the takeover of Gamuda’s four tolled highways, Gamuda had in Dec 2019 said its deadline to finalise this agreement has been pushed back to Feb 28,2020 from Dec 31,2019 previously.

“The long stop date to satisfy the conditions precedent and the date of completion shall be extended to a date which shall be mutually agreed between MOF Inc and each of the concession holding companies, ” it had said then.

The government had earlier announced a plan to take over four highways in the Klang Valley for RM6.2bil.

The deal was originally supposed to have been concluded by end of August. However, this deadline had been extended for several times now.

It had been extended to Oct 31 initially and then the second time to Dec 31,2019.

The extension of this deadline to the end of February would be its third time it is being delayed.

PLUS Expressways had attracted various bids prior to this, with many parties having tendered their unsolicited offers for these highway assets.

The offers included one from the Widad Business Group, which had last year offered RM3bil cash to buy up the equity portion of UEM and EPF that hold PLUS in proportions of 51%:49%.

Hong Kong-based private equity firm RRJ Capital had also earlier proposed to acquire PLUS for RM3.5bil.

Maju Holdings Sdn Bhd, which is controlled by businessman Tan Sri Abu Sahid Mohamed, had then offered to acquire PLUS at an enterprise value of RM34.9bil.

This offer by Maju also includes the leading highway operator’s debt to its bondholders. A group led by Tan Sri Halim Saad too had put in a multi-billion ringgit bid for the highway assets.

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