Puncak Niaga awaits response from KDEB on improved takeover terms for water assets

water treatment plant

 

• Puncak Niaga Holdings Bhd, which has accepted in-principle the offer from Kumpulan Darul Ehsan Bhd (KDEB) to acquire its water assets, expects KDEB to respond before the year-end to its request for improved takeover terms.
• “The company wishes to inform that Puncak Niaga received a letter from KDEB to request for time until Dec 31 to revert with an appropriate response to Puncak’s letter,’’ it said in a short statement to Bursa Malaysia yesterday.
• Puncak Niaga had on Dec 4 accepted in-principle the offer by KDEB, on behalf of the Selangor government, to acquire its 100% equity stake in Puncak Niaga (M) Sdn Bhd and 70% equity stake in Syarikat Bekalan Air Selangor Sdn Bhd (Syabas).
• However, in response to the offer, Puncak Niaga said its willingness to sell its assets was subject to several conditions.
• It wants the total equity contribution to be paid to it and this includes a compounded return of 15% per year as compensation to the holding company for the loss of future earnings from the sale.
• Puncak Niaga had then given KDEB seven days to respond to its request.
• It is reported that Selangor Mentri Besar Tan Sri Khalid Ibrahim was confident of sealing a deal with Puncak Niaga.
• “Yes, there are a few conditions listed by Puncak Niaga, but I am confident we can reach an agreement on the matter,” he was quoted as saying.
• To recap, the recent offer was the fifth attempt made by the Selangor government to consolidate the water assets in the last five years.
• The latest offer values the four water concessionaires at RM9.65bil. The four are Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (Splash), Puncak Niaga (M) Sdn Bhd, Syabas and Konsortium Abass Sdn Bhd.
• Puncak Niaga (M) Sdn Bhd, amongst other, holds five water treatment concessions in Selangor, operating and managing 29 water treatment plants, including the Sungai Langat water treatment plant.
• Puncak Niaga had claimed that under the terms of the last offer, the actual proceeds to be received by the concessionaires were a lot less than what was offered by the state.
• Both Puncak Niaga and Kumpulan Perangsang Selangor Bhd (which owns 30% equity stake in Syabas) said they had accepted the takeover offer from KDEB with conditions, while Gamuda Bhd said it was unable to consider the offer to buy out its 40% stake in water treatment operator Splash.