MD Soam will retire upon the conclusion of the company’s AGM on Aug 28

by SHAZNI ONG / pic by MUHD AMIN NAHARUL

IJM Corp Bhd has announced that Datuk Soam Heng Choon (picture) will retire as the MD upon the conclusion of the company’s AGM on Aug 28, 2019.

In an exchange filing yesterday, the diversified group noted Soam, who is attaining the age of 60, will remain as CEO until Aug 31, 2019.

IJM construction division MD Liew Hau Seng, 53, will be appointed as the new CEO and MD of the company with effect from Sept 1, 2019.

Soam, who has a 30-year long career with IJM, is the Real Estate and Housing Developers’ Association (Rehda) Malaysia president for the 2018/2020 term.

Liew will head IJM Corp, currently holding a RM6.7 billion outstanding construction orderbook, the company stated.

The major projects include road projects, infrastructure and buildings contracts such as the light rail transil (LRT) and mass rapid transit (MRT) work packages, the West Coast Expressway, Kuantan Port New Deep Water Terminal as well as the Equatorial Hotel and Bukit Bintang City Centre Mall in Kuala Lumpur.

The construction and property development giant also announced that its chairman Tan Sri Abdul Halim Ali will be stepping down from the board at the conclusion of the AGM following the completion of his 12-year tenure as an independent director.

The changes in IJM Corp boardroom, which is part of the group’s established succession plan, also will see present deputy chairman Tan Sri Tan Boon Seng @ Krishnan be re-designated as the chairman of the company with effect from Aug 29, 2019.

The company last week announced it had been terminated as the works contractor for the underground package of the LRT Line 3 (LRT3) from Bandar Utama to Johan Setia, due to the project being remodelled from a project deli-very partnership model to a fixed price contract model, pursuant to the government’s direction.

Preliminary works had commenced before the project was suspended in June last year. IJM is currently consulting with its advisors and will seek appropriate legal redress under the contract.

“The LRT3 income was estimated to contribute 15% to its annual construction earnings. Thus, losing the contract will result in a 6% reduction to our earnings forecasts for IJM,” MIDF Research noted.

IJM could also risk having other contracts such as its MRT Line 2 (MRT2) job terminated, although according to MIDF Amanah Investment Bank Bhd, in a note recently said the possibility is remote, considering the progress work on the MRT2 was already at 55% as of May 2019.

The research firm said if the turnkey contractor calls for an open re-tendering of the work package, IJM “stands a fair chance” of winning as a subcontractor.

IJM’s outstanding orderbook has a healthy cover ratio of 3.4 times FY19 construction revenue.

Shares of IJM closed two sen or 0.83% lower at RM2.38 yesterday, giving it a market value of RM8.66 billion.