Air Selangor’s offer for Splash turns unconditional


The proposed acquisition of Pengurusan Air Selangor Sdn Bhd’s (Air Selangor) entire stake in Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (Splash) from Syarikat Pengeluar Air Selangor Holdings Bhd (Splash Holdings) has become unconditional as conditions precedent in the sale and purchase agreement were fulfilled on Monday.

Gamuda Bhd and Kumpulan Perangsang Selangor Bhd — which owned 40% and 30% stakes in Splash Holdings respectively — had each received the upfront sum of RM1.9 billion from Air Selangor yesterday.

“As such, the offer has been completed on even date. Accordingly, Splash shall cease to be a subsidiary of Splash Holdings with effect from April 24, 2019,” both companies noted in separate exchange filings yesterday.

Splash’s remaining 30% stake is held by Sweet Water SPV Sdn Bhd, a private vehicle of businessman Tan Sri Wan Azmi Wan Hamzah.

The long-standing water deal was finally concluded in August last year after Air Selangor made an offer to buy out Splash for RM2.55 billion.

Prior to this, Selangor Mentri Besar (MB) Amirudin Shari said the amount is a 28% discount based on Splash’s net book value as of June 30.

Upon the deal, Air Selangor will make an upfront payment of RM1.9 billion and the remaining RM650 million will be paid through instalments for a period of nine years.

Gamuda Bhd and Taliworks Corp Bhd had accepted the offer from Air Selangor as part of the acquisition of Splash.

Gamuda said its 80%-owned subsidiary, Gamuda Water Sdn Bhd, accepted the offer from Air Selangor to acquire Splash, which involves a settlement agreement and new operations and maintenance agreement of Sungai Selangor Water Treatment Plant Phase 3 (SSP3).

Taliworks also said its wholly owned subsidiary, Sungai Harmoni Sdn Bhd, accepted the offer from Air Selangor and requested to terminate all existing agreements relating to SSP1 and enter into a new agreement.

The takeover deal was part of a restructuring move that required the state government to acquire private companies that were involved in supplying, treating and distributing water in Selangor.

The earlier deal was also formulated to return the rights of managing water to Selangor instead of four concessionaires — namely Syarikat Bekalan Air Selangor Sdn Bhd, Puncak Niaga Sdn Bhd, Konsortium Abbas Sdn Bhd and Splash.

Air Selangor managed to acquire three other concessionaires except for Splash, which declined the initial RM250.6 million offer, claiming that the offer would incur a divestment loss of RM920 million.

As takeover of Splash failed, it had left the company’s water plants with minimal upgrading to avoid any interference on the valuation of assets, while the then Selangor MB Datuk Seri Mohamed Azmin Ali said it was not in Selangor’s territory to perform maintenance.

The complicated saga had left Selangor people with a series of water disruption.