KUALA LUMPUR (March 20): The government "will not take the risk” to bring toll concessionaires to court if they demand compensation for loss of future earnings in a premature termination of a concession contract, Works Minister Datuk Fadillah Yusof said.
“The government will not take the risk of bringing them to court. (That's because) the losers will be the government and the rakyat if there is compensation to be paid on top of the legal costs,” Fadillah told the Dewan Rakyat today in reply to a question posed by Serdang Member of Parliament Ong Kian Ming.
He said in the event of the early termination of a concession, compensation for loss of future profits is “part of the negotiation” between the government and highway concessionaires despite it not being part of terms and conditions in most concession agreements.
"When there is an agreement between both (parties), it is fine. But when one side does not agree, they will insist on [compensation] of future profits,” he added.
Earlier, Fadillah quoted a 2010 study by the Performance Management & Delivery Unit which estimated overall costs to take over all highways in the country to be RM383.3 billion — comprising costs to take over the highway concessionaires (RM45.2 billion) and costs to abolish toll collection (RM338.1 billion).
Ong argued that compensation for future earnings should not be included in the calculation, and that the government could save more by going to court instead of abiding by the terms of the concessions.
“The cost for toll abolishments include compensation for loss of future profits for the toll companies. However, in the terms and conditions of almost all toll concessionaires which I have studied, there was no mention of takeover costs based on future profits.
“What they said is the payment for cost of construction and cost of capital,” said Ong.
According to data from the Ministry of Works, the government paid Lingkaran Transkota Sdn Bhd (Litrak), which holds the concession for Damansara-Puchong highway (LDP) compensation totalling around RM1 billion between 2000 and 2015, he added.
“If they [concessionaires] don’t agree, go to court. [The government] can save on the compensation payment and and benefit the rakyat,” urged Ong.
Ong also brought up the proposed takeover of Eastern Dispersal Link (EDL) from Malaysian Resources Corp Bhd (MRCB) by the federal government, which did not include any calculation of future earnings from toll collection.
“What was underlined included the cost of construction, and part of the capital funded by shareholders for the payment — with a return of investment (ROI) of between 8% and 10%.
"So the formula can be used to take over other toll concessionaires such as LDP and the [Kajang]-SILK [highway],” said Ong.
On EDL, Fadillah said: “We have not finalised the compensation costs [for EDL], but negotiations have started.”
What attracts me is d last few setences as below. If government can compensate d cost of construction n take over d sukuk loan, it is enough for me.
Ong also brought up the proposed takeover of Eastern Dispersal Link (EDL) from Malaysia “What was underlined included the cost of construction, and part of the capital funded by shareholders for the payment — with a return of investment (ROI) of between 8% and 10%.
"So the formula can be used to take over other toll concessionaires such as LDP and the [Kajang]-SILK [highway],” said Ong.
What attracts me is d last few setences as below. If government can compensate d cost of construction n take over d sukuk loan, it is enough for me.
Ong also brought up the proposed takeover of Eastern Dispersal Link (EDL) from Malaysia “What was underlined included the cost of construction, and part of the capital funded by shareholders for the payment — with a return of investment (ROI) of between 8% and 10%.
"So the formula can be used to take over other toll concessionaires such as LDP and the [Kajang]-SILK [highway],” said Ong. 20/03/2018 21:16
Martin bro , thanks. I did rub my eyes properly. I wish I was not wrong about Trend. Truly thanks him to update it to us. I thank you too for verification.
Walao weh you ppl, can't be convincing nvm purposely come mess around only... want quarrel go other forum can ah??? For how many days already, still try to flood here with nonsense .... Hmmmm aiyo pening .... Give me more reasons to convince me to cut loss and sell la. At least be a proper critics can ah??
You look at Calvin, I know many of y'all don't like him... But he did his job... You guys should do too ... Write something like that in other perspective try convince us to sell... Come on, you can do it. . . Not idiot no pussy, non pondan, no .... Try something better come on...
joetay, you tay, me teh. we may have relatives tie 300 years ago. mungkin your datuk pinya datuk pinya datuk and my datuk pinya datuk pinyak datuk same family members. huhu...
Those fella in this thread will keep call buy bcz they stuck at high price. They will tell you bunch of stories which is very fascinating like dream but seriously it won't happen. Ask yourself is it worth to invest into big brand with low Roe, low Dy and most importantly now is overvalued PE28 and gearing of more than 50%
If everything will work like what they sound Mrcb should be at least 2. No big player is buying retailer is buying. Big player is rushing to sell. It will nvr stand at 1.00 again
how nice if can reach 0.880 in two weeks time. by that time C30 = 0.045. if park in 12000 lots and when mother up till 1.350, C30 -> 0.250 = 450% returned > 242k profits. huhu...
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
joetay
3,737 posts
Posted by joetay > 2018-03-20 20:43 | Report Abuse
lol...........
dont worry, i help u do brain exercise.
but seriously, have a look at csmb and sarawak election. if u r updated with political ongoings, u shld be able to decipher my hint.