KEB nears RM4.5b loan deal for highway project

KEB nears RM4.5b loan deal for highway project
By Azlan Abu Bakar
Published: 2008/12/01
BT

Kumpulan Europlus Bhd (3565) is close to securing a RM4.5 billion loan from a group of banks to build the West Coast Expressway (WCE), which links Banting in Selangor to Taiping, Perak. "The current weak global economy has affected efforts in getting the money earlier," a company official said, declining to disclose further details.However, it is unclear if KEB will get to keep the highway. The Economic Planning Unit (EPU) declined comment when contacted.On November 12, EPU director Tan Sri Dr Sulaiman Mahbob said the WCE could be re-tendered as the consortium involved had failed to secure financing in time.

It was reported that the WCE would cost around RM3 billion. However, the fact that KEB wants to borrow a lot more could be due to the rise in cost of raw materials.KEB's 60 per cent subsidiary, Konsortium LPB Sdn Bhd (KLPB), was awarded the WCE concession on May 25 2007.KLPB's other shareholders are Kumpulan Darul Ehsan Bhd and Putera Capital Bhd, each holding a 20 per cent stake.

Construction work on the 250km highway was supposed to start last June."We have already checked the status of the highway project with the Works Ministry and were told it has not been cancelled," the company official said when contacted by Business Times.Phase 1 which involves the stretch between Tanjung Karang and Banting was targeted to be completed by 2011, while Phase 2 that involves the stretch between Taiping and Sabak Bernam is initially scheduled to begin in 2010 and completed by 2013.The highway will run parallel to a stretch of the North-South Expressway.Under the concession agreement, the WCE will be built and tolled by KLPB for 33 years before the highway is transferred to the government.

Putera Capital bidding for RM9b local jobs

By Zurinna Raja Adam
Published: 2008/11/29

DESPITE its status as a financially-troubled group, Putera Capital Bhd (2895) has bid for construction jobs worth about RM9 billion in Malaysia.The group, which had its first restructuring proposal rejected by the authorities, is awaiting response to its second revamp plan."If all goes well, than we can embark on these projects with our strategic partners," chief executive officer Wan Azman Wan Salleh said after the group's annual general meeting in Kuala Lumpur yesterday.However, he declined to comment further on the revamp plan.

The group has not made money in seven years and it faces the threat of having its shares taken off the stock exchange.For the financial period ended May 31 2008, the group posted a loss of RM9.2 million on revenue of RM1.5 million.Putera Capital has closed its loss-making textile division and it wants to focus on the construction and infrastructure business.

It holds a 20 per cent stake in the West Coast Expressway, a multi-billion-ringgit project that has yet to take off.On its partnership with Melewar Industrial Group Bhd to build a proposed RM2.2 billion monorail system in George Town Penang, Wan Azman said the group remains hopeful of the project.They are still waiting for a response from the state government, he added.