Bidders have mixed views over PLUS takeover no-go
The government’s decision to not sell PLUS has brought about mixed reactions from the bidders, The Star reports. RRJ Capital, a Malaysian-led private equity firm with US$20 billion (over RM81 billion) of funds under its management and one of the four leading bidders in the takeover, said the move allowed the company to move on and study other investment opportunities.
Company chairman and CEO Richard Ong said he thinks the process is fair. “We are happy with the final decision of the government and will move on to focus on other investments. It is the prerogative of the government to divest or not,” Ong told the publication.
In its initial proposal, RRJ Capital offered to buy PLUS for RM3 billion and would reduce toll rates by 20% across the board, although it later raised the bid to RM3.5 billion.
However, Tan Sri Abu Sahid Mohamed of Maju Holdings opined that the cabinet’s decision to extend the concession period by an additional 20 years was a mistake, claiming that his bid offered superior terms.
“My bid was put to the Khazanah Nasional chairman himself, prime minister Tun Dr Mahathir Mohamad, which was 10 years’ (concession period) extension with a 25% discount. How can that not be better than a 20 year extension with 18% discount?” asked Abu Sahid.
“I could have fixed lighting (issues) completely throughout the highway – but I believe my bid did not win because I can do it much cheaper than the rest of the bidders,” he added. Last July, Maju Holdings offered RM3.5 billion for PLUS Malaysia, and said the deal would assume the concessionaire’s debts of around RM30 billion.
The revised offer also included discounting existing toll rates by up to 36%, depending on how long the concession would be extended. Works minister Baru Bian even described the bid as “attractive,” but prime minister Tun Dr Mahathir Mohamed revealed that none of the bids that have been made were attractive enough.
“We have studied all the bids made by the private sector, and also the bid by Khazanah Nasional. We decided that the best way is not to sell PLUS to anybody, but to keep it with Khazanah Nasional and Employees Provident Fund (EPF),” Mahathir said, adding that PLUS will be given a 20-year extension of its toll concession. The planned 18% reduction in the toll rate, as determined during Budget 2020, would still be implemented.
Meanwhile, there is still no mention of the proposed takeover of four Klang Valley highways operated by Gamuda. Earlier, it was reported that the government had not made a decision yet on the matter. The highways operated by Gamuda are the Lebuhraya Damansara Puchong (LDP), Sistem Penyuraian Trafik KL Barat (Sprint), Lebuhraya Shah Alam (Kesas) and the Smart Tunnel.
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