Recap on offers for PLUS ahead of Cabinet decision on possible sale

The highway concessionaire is jointly owned by Khazanah through UEM and EPF

by FARA AISYAH / pic by TMR FILE PIX

THE Cabinet is expected to decide on a possible sale of PLUS Malaysia Bhd today, decidedly one of the largest corporate announcements the country will witness this year as the government moves to scale down its role in the corporate sector.

Prominent businessmen and companies came forward last year to table bids for the highway concessionaire which is now jointly owned by sovereign wealth fund Khazanah Nasional Bhd through UEM Group Bhd, and the Employees Provident Fund (EPF). Khazanah holds a 51% stake, while EPF the remaining 49%. The highway service provider has attracted four major suitors, with the highest bid standing at RM5.2 billion. The bidders are as follows.

Halim Saad and Wong Gian Kui

In October last year, Tan Sri Halim Saad proposed to buy Khazanah’s entire stake in PLUS for RM5.2 billion.

In the highest bid made so far by any parties for cash-minting PLUS, Halim also proposed a 25% discount on toll rates and for the concession period to end as per status quo — December 2038.

Halim, who is executive vice chairman of Sumatec Resources Bhd, is partnering Datuk Wong Gian Kui in the quest to acquire Khazanah’s interest in PLUS, based on the offer letter to the government.

Wong sits on the board of Insas Bhd, Inari Amertron Bhd, Ho Hup Construction Co Bhd, SYF Resources Bhd and Yi-Lai Bhd.

Halim’s offer letter states that EPF can retain its shareholding if it wishes to do so.

Widad Business Group

Widad Business Group Sdn Bhd, an integrated facility management and construction group, is offering to buy 100% of PLUS for RM5.3 billion in cash. It will waive RM3.038 billion in compensation and assume debts of RM30 billion, bringing the total enterprise value of the offer to RM38.338 billion. Widad’s revised offer will waive the RM11 billion sukuk guarantee by the government and give the government the option to buy back PLUS after 10 years based on market valuation.

This revised offer includes a reduction in toll rates and improvement in services.

In early October 2019, the group offered to take control of PLUS by buying the 51% stake held by Khazanah for RM1.5 billion in cash or 100% of the concessionaires for RM3 billion in cash.

The group owns 65% of Widad Group Bhd and 63% of Dataprep Holdings Bhd, which are listed entities.

Maju Holdings

Tan Sri Abu Sahid Mohamed and his flagship Maju Holdings Sdn Bhd has increased its reduction in tolls from 25% to 36% under its revised takeover bid for PLUS, after an initial proposal to purchase PLUS at an enterprise value of RM34.9 billion.

Maju Holdings submitted its bid to the government in October, the company’s spokesperson said in a statement then.

The firm also proposed to bear the toll reduction in full and is in no way seeking financial compensation from the government.

The government currently owes PLUS RM2.7 billion in toll compensation and if Maju Holdings wins the bid for PLUS, the group will no longer hold the government responsible for the debts.

Maju Holdings’ revised offer came after a Malaysian-led Hong Kong-based private equity (PE) group was reported to have offered to take over PLUS for RM3.5 billion.

RRJ Capital

Reports in October last year stated that RRJ Capital — a Hong Kong-based PE firm with investments in China and South-East Asia — had proposed to acquire PLUS for RM3 billion.

The firm was reported to have offered a 20% cut on toll rates across the board if successful in its bid, which was said to have been submitted to Khazanah.

The company’s proposal to buy the firm in its entirety is said to include the interest of UEM and EPF in the redeemable convertible unsecured loan stock issued by Projek Lebuhraya Usaha Sama Bhd, a fully-held subsidiary of PLUS.