Widad seeks long-term concession, RE projects

The company is looking to acquire long-term assets with concessions of more than 10 years to boost its cash flow and for income stability

By NUR HANANI AZMAN / Pic source widadgroup.com

WIDAD Group Bhd plans to explore more opportunities in renewable energy (RE) and concession businesses to diversify its income stream in the future.

Its MD Datuk Dr Mohd Rizal Mohd Jaafar (picture) said the group is actively engaging with relevant partners including government-linked companies and states to pursue plants in the RE space.

“It’s not far away from the core business. RE and facility management are interrelated. When we do facility management, there are energy savings that come into the picture. That’s why we are looking at this area,” he told The Malaysian Reserve.

The integrated facility management (IFM) and construction player incorporated a wholly-owned subsidiary, Widad Energy Sdn Bhd, on Feb 10 for the purpose.

Widad Energy will undertake investments, installation of non-electric solar energy collectors including additions, alterations, maintenance and repair, and operation of generation facilities that produce electric energy.

On Feb 3, the group entered into a memorandum of collaboration (MoC) with Motion Ventures Sdn Bhd in relation to the facility management of the large-scale photovoltaic plants project.

The project boasts a total capacity of 1,000MW for Peninsular Malaysia under package P1: 10MWa.c. to less than 20MWa.c. and package P2: 30MWa.c. to 50MWa.c. and 66 community solar projects.

Mohd Rizal believes Widad will enjoy a better year following the resumption of some mega infrastructure projects and the National Covid-19 Immunisation Programme.

“Last year was very challenging, but we managed to remain profitable because we have two core businesses. IFM, which contributed 67% to revenue, cushioned the negative effect of the construction industries.

“This year, we foresee IFM would maintain that position. Construction is picking up. Many tenders are being offered by the government and its agencies to the contractors. We have participated a lot this year,” he added.

Mohd Rizal said Widad has participated in tender bids worth more than RM2 billion in the construction sector.

The company is also in the advanced stage of negotiations with several parties in essential services, education and training cen- tres to acquire long-term concession assets in the IFM business.

“We are looking to acquire long- term assets with concessions of more than 10 years to boost our cash flow and for income stability.

“We completed the acquisition of Serendah Heights Sdn Bhd, the concession holder for the development, construction and maintenance of Universiti Teknologi Mara campus in Jasin, Melaka. This is the criteria of the project we are looking at,” he explained.

The acquisition of Serendah Heights expands the company’s IFM service offerings into the education industry and strengthens its orderbook to RM1.5 billion.

The company yesterday bought Palm Shore Holdings Sdn Bhd (PSHSB) for RM35 million cash. PSHSB has a concession agreement with the government to develop the facilities and infrastructure, and to carry out maintenance works for an integrated training centre for the Royal Malaysian Navy at Sungai Lunchoo in Johor. The concession ends in February 2040, and is worth RM291 million, according to Widad’s exchange filing yesterday.

On Dec 16, 2020, Widad signed an MoC with Rinani Dynamic Sdn Bhd to distribute, market and sell Covid-19 vaccine developed by Vaxart Inc, as well as its other products.

Vaxart, a US biotechnology company, developed an oral tablet Covid-19 vaccine known as VXA-CoV2-1.

Mohd Rizal said Vaxart is now entering stage two study, while stage three is expected to start in the second half of the year.

“Our role is basically to do distribution of the vaccine. This is a new segment and, in a way, supports the current pandemic issue. We need a variety of vaccines to expedite the recovery of the nation. But I don’t think this will contribute much to the group,” he said.

Widad Business Group’s (WBG) mixed development project, [email protected] in Langkawi, Kedah, worth RM40 billion, has raised environmental concerns.

However, Mohd Rizal assured the design and concept of the project will not compromise the island’s natural surroundings.

“It’s not something new. There are two parcels of land. For phase one, the land has been reclaimed and ready for development. Con- cept wise, we still maintain nature and water flows.

“All these are subject to Environmental Impact Assessment’s approval. We cannot just develop as we need to compromise with the quality of the environment and maintain a quality, green concept in that development,” he said.

More importantly, he said, [email protected] will create some 15,000-20,000 jobs for the locals.

The proposed development is a mixed development project with a commercial centre, residences and hotel. There will be a cultural village and a dedicated place for artists to perform to attract regional and tourists.

The holding company targets to launch phase one comprising residences, villa, apartments, commercial centre and golf course by year-end.

“We are still deliberating and hope to finalise very soon. We plan to do development order submission in May,” he added.

[email protected] is a proposed modern development with Islamic and tropical vernacular concepts that will potentially change the landscape of Langkawi.

Currently, 90% of the 800ha development site near Langkawi International Airport consist of ocean and WBG is planning to erect a man-made island which will eventually span 50% of the entire project.

Widad’s shares rose 4.5 sen to 54 sen yesterday, giving it a market valuation of RM1.46 billion.