CEO Morning Brief

Putrajaya Awards LSH Capital's JV a 20-year Concession for KL Tower Operation

Publish date: Tue, 11 Jun 2024, 10:30 AM
0 23,762
TheEdge CEO Morning Brief

KUALA LUMPUR (June 10): The federal government has agreed in principle to grant a 20-year concession for the operation and maintenance management of Kuala Lumpur Tower to construction company Lim Seong Hai Capital Bhd (KL:LSH) and its joint venture (JV) partner.

In a filing on Monday, LSH Capital said that its subsidiary, LSH BEST Builders Sdn Bhd, and Service Master (M) Sdn Bhd formed LSHBB-SMMSB JV, which received a letter from the Public Private Partnership Unit (UKAS), Prime Minister’s Department, on June 7, informing them of the government's agreement in principle for the operation and maintenance management of KL Tower.

LSHBB-SMMSB JV is 70% owned by LSH BEST Builders, with the remaining stake held by Service Master.

LSH Capital is primarily engaged in construction, construction-related services, and property development, having been involved in several nation-building projects such as the Duta–Ulu Klang Expressway (DUKE highway) and the River of Life project.

LSH Capital is currently in the process of transferring its listing from the LEAP Market to the ACE Market of Bursa Malaysia Securities Bhd, with completion expected by the fourth quarter of 2024.

Service Master is a wholly owned Bumiputera private company, established in 1989, specialising in integrated facilities management services.

LSH Capital non-executive chairman Tan Sri Lim Keng Cheng expressed delight that they were chosen by the government to be part of this iconic telecommunication, hospitality, and tourist destination.

"LSHBB-SMMSB JV envisions a modernised KL Tower with an elevated visitor experience through refurbishment and enhanced retail, cultural, and recreational spaces. We are excited to deliver a KL Tower that Malaysians can be proud of," Lim said in a separate statement.

Communications Minister Fahmi Fadzil announced on May 29 that the government had agreed to LSHBB-SMMSB JV operating KL Tower for 20 years.

The decision came after the government and UKAS evaluated tenders and proposals following a request for proposal (RFP), according to Fahmi. He added that one of the conditions set by the government was that all companies involved in the tender needed to have a minimum financial capacity of RM18 million.

"LSH BEST Builders has met all the terms [of the RFP]. No integrity issues or any other problems were found," Fahmi said.

KL Tower, owned by the government and operated under a concession, has come under scrutiny after the Malaysian Anti-Corruption Commission launched an investigation in 2022 into alleged irregularities surrounding the sale of shares and the transfer of KL Tower's ownership from telecommunications company Telekom Malaysia Bhd (KL:TM) to a lesser-known firm.

KL Tower was previously managed by Menara Kuala Lumpur Sdn Bhd, a subsidiary of TM. In October 2021, TM announced that it decided not to renew the KL Tower concession after taking into consideration the change in the business nature of KL Tower — from telecommunications services to tourism and hospitality.

In April last year, Hydroshoppe Sdn Bhd director Abdul Hamid Shaikh Abdul Razak Shaikh was charged with offering RM500,000 annually for 15 years to then-communications and multimedia minister Tan Sri Annuar Musa to expedite the takeover of the KL Tower concession by Abdul Hamid's company.

Source: TheEdge - 11 Jun 2024

Related Stocks
Market Buzz
Be the first to like this. Showing 0 of 0 comments

Post a Comment