Minister in the Prime Minister’s Department Datuk Seri Abdul Rahman Dahlan insists that the federal government did not “flip-flop” in its decision to scrap the sale of a 60 percent stake in Bandar Malaysia, reported Bernama.
“The deal was never a flip flop. There were certain conditions not fulfilled by the previous consortium, so the government terminated the deal legally.”
He said on Tuesday (16 May) that Prime Minister Datuk Seri Najib Tun Razak had acted in the best interest of Malaysians by legally terminating the contract so that it can get a more advantageous deal.
“During his trip to Beijing, the Prime Minister made it clear that the new consortium might include the previous consortium players, so there is no issue.”
Last month, the Ministry of Finance’s (MoF) wholly-owned unit TRX City Sdn Bhd terminated the share sale agreement with a IWH-CREC, a consortium consisting of Iskandar Waterfront Holdings (IWH) and China Railway Engineering Corp (M) Sdn Bhd (CREC).
It said IWH-CREC failed to fully pay the RM7.41 billion for the Bandar Malaysia stake in spite of repeated extensions granted since the agreement was signed in December 2015. Hence, after the deal was terminated, the government refunded the consortium’s RM741 million down payment.
While the MoF is now seeking expressions of interest from companies keen to take on the role as Bandar Malaysia’s master developer, it will now retain full ownership of the prime site.
“The MoF has stated clearly that it would hold full ownership of the land. The master developer would probably be tasked to come up with an iconic building for development. It is similar to how the Tun Razak Exchange is being developed,” said an insider.
However, it’s still uncertain which companies will actually take part in the Bandar Malaysia project, as seen in the volatile movements of stock of firms anticipated to participate in the massive development.
For instance, stock prices of Iskandar Waterfront City Bhd (IWC) reached a day’s high of RM2.45 after news broke out that China Railway Engineering Corp (CREC) will join forces with Hong Kong’s rail operator MTR Corp to bid for the High Speed Rail that will connect Singapore with Kuala Lumpur. Notably, the Malaysian terminus of the HSR is situated in Bandar Malaysia.
But minutes after the stock fell to RM1.98, shares of Malton Bhd, another contender for Bandar Malaysia, surged by 25.16 percent to RM1.94, before ending the day at RM1.78, up 24 sen.
Image sourced from The Star
Radin Ghazali, Content Writer at PropertyGuru, edited this story. To contact her about this or other stories email radin@propertyguru.com.my
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