kahhoengckk2266, what an excellent news to start the day! The whole restructuring has been hard to swallow and against common sense of addressing the issue as soon as possible. With the details out, at least we would have to rely on 'insiders' for updates... Or, at least I don't have to keep on calling Azmin stupid
PETALING JAYA: Despite speculation that the Selangor water restructuring is going be resolved soon, Puncak Niaga Holdings Bhd has yet to receive any written confirmation from Selangor state-owned Pengurusan Air Selangor Sdn Bhd (Air Selangor), according to a source.
Puncak Niaga rose to an intra-day high of RM2.73 yesterday, before ending one sen higher at RM2.68 with 1.6 million shares changing hands.
“Puncak Niaga has yet to receive any letter from Air Selangor as of today. But we still have time until July 13 for both governments to reach a consensus on the matter,” he told StarBiz yesterday.
The Selangor water restructuring has hit a snag since 2008 due to various disagreements between the state and federal governments although the master agreement was signed last year during Tan Sri Khalid Ibrahim’s tenure as Mentri Besar.
Under the master agreement, Puncak Niaga would hand over the Selangor water concession businesses of subsidiaries Puncak Niaga Sdn Bhd and Syarikat Bekalan Air Selangor Sdn Bhd (Syabas) to the state government for RM1.56bil.
Now, both parties are finalising the supplementary agreement over issues mainly on some water assets located on federal-owned land. Last month, Puncak Niaga agreed to a sixth extension until July 13, 2015 to fulfil the conditions precedent in the agreement dated Nov 11, 2014.
Tan Sri Rozali Ismail, executive chairman and the major shareholder of the water treatment and supply company, recently voiced out that this was the last extension and it would resort to legal action if the deal was still not resolved.
He is said to have taken charge of the company’s operation now as acting group managing director as well.
Once the Selangor water restructuring issue is resolved, the company’s water treatment business will mainly consist of its projects in China which comprises two water treatment concessions expiring in 2038 and 2039, and one waste water treatment concession expiring in 2035.
But the source also revealed that Puncak Niaga was mulling over the idea to dispose of its water business in China as well. “It will be interesting to see how Puncak Niaga is going to invest the proceeds from the deal,” he said.
Rozali had expressed his plan to acquire an oil and gas (O&G) company and to further expand into palm oil industry.
Puncak Niaga has an O&G business now parked under Puncak Oil and Gas Sdn Bhd and GOM Resources Sdn Bhd.
It is understood that the O&G business will become its main contributor following the disposal of its water assets and operations.
Rozali, who is a lawyer by training, has always been keen with the palm oil industry, given his personal background in the sector.
CIMB Research in a previous report said besides a RM1 dividend, which translated to a 29% dividend yield, Puncak Niaga’s profit from the divestment would feature mainly its domestic O&G venture and the construction segment. “This excludes the proforma RM415m gain from the disposal of the water assets,” said the report.