Thursday, March 7, 2013

KiniBiz:No deal yet for S’gor water

As the deadline for Selangor’s latest RM9.65 billion takeover offer rolls by, three of the four water concessionaires said that they want further discussions before they can accept the deal.

This was announced to Bursa Malaysia by Puncak Holdings Bhd and Gamuda Bhd today, Meantime, Selangor Menteri Besar Abdul Khalid Ibrahim said that the state will give an update in the next fortnight, Bernama reported.

Abdul Khalid said: “There are several initiatives to find the solutions before the matter is presented to the Energy, Green Technology and Water Ministry. (State investment arm) Kumpulan Darul Ehsan Bhd (KDEB) as well as Puncak Niaga will from time to time announce developments on the discussions,” he told a media conference.

Gamuda, which owns 40 percent of water treatment company Syarikat Pengeluar Air Selangor Holdings (Splash) said that while it is seeking further talks, it is “willing to pursue an agreement” after all terms are clarified.

“Subject to all matters being satisfactorily concluded and agreed upon, Gamuda has informed KDEB that it is willing to pursue an agreement with KDEB,” it said.

Meanwhile, Puncak, which owns majority stakes in two water concessionaires, said that the offer is “incomplete” and “inconclusive”.

“Given these circumstances, the (Puncak board of directors) is also not ready to convene a general meeting for the purpose of tabling the KDEB offers to the shareholders of the company for consideration,” it said.

However, it added that it is “willing to hold discussions” with KDEB as long as the latter is ready to provide “definitive answers to all issues raised by the company”.

Puncak cannot agree because…

Puncak wholly-owns water treatment company Puncak Niaga Sdn Bhd (PNSB) and owns 70 percent of water distribution company Syarikat Bekalan Air Selangor (Syabas).

The remaining water concessionaire is Konsortium Abass Sdn Bhd which is 91-percent owned by the Selangor government.

In its announcement, Puncak said its board had deliberated on the matter in the absence of its executive chairperson Rozali Ismail. Rozali owns 41 percent of Puncak.

Puncak’s board, advised by Hong Leong Investment Bank Bhd said it could not accept the offer now among others because:

- approval and consent is required from the federal government and federal agencies;

- while the offer letter states that the offer will expire at end of business on March 6, it also states that it can be revised or extended at KDEB’s discretion;

- the terms are only indicative and a definitive agreement does not amount to a contract.

Selangor previously said that the RM9.65 billion is its last offer, and that further disputes should be taken up in arbitration.

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