The government denies that its proposal to takeover four highways concessionaires amounting to RM6.2 billion has been put on hold pending review
The government denies that its proposal to takeover four highway concessionaires amounting to RM6.2 billion has been put on hold pending review PIX: AFFAN FAUZI / MalaysiaGazette / 05 JUNE 2019

By Mohammad Arif Nizam

PUTRAJAYA – The government denies that its proposal to takeover four highway concessionaires amounting to RM6.2 billion has been put on hold pending review.

Prime Minister Tun Dr Mahathir Mohamad said, the government is considering the date of its implementation.

“The problem with the government is that we do not have money. However, the Ministry of Finance said that they can get enough of funds to pay for the acquisition of those four highways.

“We will need to see if it will be enough or not. They seem to be convinced it can be done.

“It is not true (the takeover is put on hold). The Cabinet has been informed by the Finance Ministry on that plan and we did not say no. Only the date of the implementation will be decided by the government,” he said after attending a Roundtable Discussion: The Prime Minister of Malaysia with the International Chambers of Commerce, organised by Talent Corp at the Putrajaya International Convention Centre (PICC).

He was asked to comment on a foreign media report that the proposal by Finance Ministry to takeover four highway concessionaires amounting to RM6.2 billion has been put on hold pending review as the cabinet finds that the offer made by the ministry is too high.

The proposed takeover involves Kesas Sdn. Bhd. (Kesas), Sistem Penyuraian Trafik KL Barat Sdn. Bhd. (Sprint), Lingkaran Trans Kota Sdn. Bhd. (Litrak) and Syarikat Mengurus Air Banjir dan Terowong Sdn. Bhd. (Smart).

The report also quoted the statement from an unnamed minister who questioned that the projection of income charged on peak hours may not be enough to cover the cost of takeover.

Therefore, the whole plan was suspended pending for revision.

According to the minister, the proposal has caused a rift in the Pakatan Harapan coalition as the Finance Minister Lim Guan Eng has presented the proposal to the people and made the takeover offer without the approval of the cabinet.

During the announcement on the takeover, Guan Eng said that the government can save RM5.3 billion through the takeover of the four highway concessionaires.

According to him, the consumers, on the other hand can save RM180 million annually as the toll charges are reduced based on the traffic.

Guan Eng said, the takeover will not utilise the government’s money as it would be made by special purpose vehicle company (SPV) under the subsidiary of Ministry of Finance Incorporated.

The SPV will finance the offer price of RM6.2 billion by publishing bonds and the collection of congestion charges. According to him, the collection will be sufficient to repay all debts, operation and maintenance costs of the highways without needing any funds from the Finance Ministry.

In other words, the cost of takeover will be paid by the congestion charges, without any government’s spending, Guan Eng said.

If the proposal is accepted, the process is expected to be implemented on 31 December.

The proposal has been accepted by Gamuda which held stakes in the highway concessionaires.

Gamuda is also involved in the Penang Transport Masterplan worth RM46 billion which created a lot of suspicion. -MalaysiaGazette

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