by S BIRRUNTHA/ pic by TMR FILE
WIDAD Business Group has thrown its hat into the ring for Malaysia’s largest highway operator with a RM3 billion offer for PLUS Expressway Bhd’s concessionaires.
The integrated facility management and construction group is offering to pay either RM1.5 billion in cash for Khazanah Nasional Bhd’s 51% stake in PLUS, or RM3 billion in cash for a full takeover including the Employees Provident Fund’s (EPF) 49% stake. Under the first option, the remaining 49% will be public shareholding owned by EPF.
“Both offers include the waiver of toll compensation worth RM2.7 billion incurred by the government for the abolishment of tolls in Plaza Batu Tiga and Bukit Kayu Hitam,” Widad said in a statement yesterday.
The takeover proposal was submitted to Prime Minister Tun Dr Mahathir Mohamad, the Works Ministry and Economic Affairs Ministry on Oct 9, 2019, the group added.
It said the offers also take into account the extension of the highway concessionaires for another 20 years after the conclusion of the concession period.
The highways involved in the concessionaires of PLUS are the North-South Expressway, Malaysia-Singapore Second Link Expressway, Penang Bridge, North-South Expressway Central Link, Butterworth-Kulim Expressway and Seremban-Port Dickson Highway.
The group has already identified a global strategic partner or investor to fund the proposed acquisition, which will also be financed by internal funds and issuances of sukuk medium-term notes and equity.
The highways will be run on an entrepreneur basis to optimise efficiency while preserving road safety and quality for the public, it said.
“In the event that Widad successfully takes over the concessionaires, the group will reduce the current toll charges by 25% to 40%,” group executive chairman Tan Sri Muhammad Ikmal Opat Abdullah said.
The group will also waive the outstanding compensation of the government to PLUS worth RM338.5 million as of Dec 31, 2018. It has proposed a 50% discount on toll fares during festive seasons such as Hari Raya Aidilfitri, Chinese New Year and Deepavali “for as long as the group deems reasonable”.
The group will also refurbish the involved highway rest stops and implement new artificial intelligence technology to improve highway and traffic management, with the “additional promise of not making any retrenchment of staff for at least five years after the takeover,” Muhammad Ikmal said.
Widad’s offer came just a day after Maju Holdings Sdn Bhd made a revised takeover bid for PLUS’ concessionaires that include a toll reduction from 25% to 36%.
The company said it would bear the toll reduction in full and would in no way seek financial compensation from the government.
Maju Holdings’ bid, which was also submitted to the government this week, came after RRJ Capital, a Malaysian-led Hong Kong-based private equity group, was reported to have made a RM3.5 billion takeover offer for PLUS.
Dr Mahathir has said PLUS can be sold to private entities, provided the government remains involved in the company’s future decision-making.
EPF CEO Tunku Alizakri Alias also said the country’s largest pension fund will consider selling its stake in PLUS for a good offer.
However, Khazanah MD Datuk Shahril Ridza Ridzuan said selling PLUS to private entities could prove a “huge moral hazard” as the asset should be owned by the Malaysian public.
Shahril Ridza was reported as saying the sovereign wealth fund has no interest in selling its majority stake in PLUS.