Johor Port, FWQ ink MoU on potential equity participation in FAP

by FARA AISYAH 

MMC Corp Bhd’s wholly owned subsidiary Johor Port Bhd has inked a memorandum of understanding (MoU) with FGV Holdings Bhd’s wholly owned subsidiary FWQ Enterprises Pte Ltd to explore the potential equity participation of up to 25% equity interest in Fauji Akbar Portia Marine Terminals Ltd (FAP).

FAP is an entity which has been granted a concession by the Port Qasim Authority to operate a dry bulk terminal located in Port Qasim, Pakistan.

The MoU is effective from Jan 3, 2020, for a period of two years.

In an exchange filing yesterday, MMC said the salient terms of the MoU include working together to make available their technical and commercial expertise and to collaborate and utilise their respective resources, capabilities and prudent experiences.

It will also act in good faith and do such things as may be necessary or expedient in relation to the preparation and submission of the expression of interest (EOI), among others.

On July 5, 2019, FAP had — via its Teaser Document and Guidelines for submitting EOI — invited selected potential investors to invest up to 25% equity interest in FAP for the future expansion and upgradation works identified by FAP for its project.

The project will consist of five potential expansion/upgradation works identified by FAP for its concession which are expected to increase throughputs, efficiency, capacity and revenue of FAP, namely land reclamation for additional storage; installation of new and efficient unloaders; warehouse extension along with additional bagging lines; installation of new silos; and jetty extension.

According to the execution of the MoU, it is not expected to have any material effect on the earnings, net assets and gearing of MMC Group for the financial year ending Dec 31, 2020 (FY20).