In March, Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili said the federal government has the option to take over Splash under the Water Services Industry Act if the state government fails to resolve issues with Splash by Oct 7.
Sure is win win deal . State government anytime can change become umno Goverment . This time sure done deal . Just wait for the wind fall durian . Huart laaa
I don't see the rationale if Najib has no money to pay for the MRT project, why he is willing to buy the SPlash at 1X and give Gamuda 1 billion of cash?
Looks like roger hope and pray for deal not to go through. It means he doesn't have any reliable news. roger, Buy some lah then you can hope for deal go through. It's more positive. make money together better than wishing others failure. ;-))
There seems to be no end in sight to the water deadlock in Selangor.
Negotiations have been going on for more than eight years between the Selangor government, the federal government and Syarikat Pengeluar Air Selangor Sdn Bhd (Splash).
Several near-solutions have come and gone and deadlines have been extended, but a solution seems nowhere in sight.
The Oct 5 deadline is approaching and the Energy, Green Technology & Water Ministry has insisted that Selangor make an offer to Splash and agree on a price tag. The federal government (through Pengurusan Aset Air Bhd or PAAB), has offered to split the bill 60:40 with Selangor.
But can’t the federal government step up, make an offer, pay the amount, and claim the 40% from Selangor later?
Or if the Oct 5 deadline lapses, should the federal government finally invoke the Water Services Industry Act 2006 (Wasia) option of a forced takeover? The Act allows the federal government to take over a concessionaire’s licence if it is of national interest.
But the federal government seems reluctant to invoke Wasia as the acquisition of Splash by the state government has not been completed. Splash is currently valued at some RM2.8-3.2 bil, although the actual figure is debatable.
Splash’s shareholders are Gamuda Bhd (40%), Sweet Water SPV Sdn Bhd (30%) which is the private vehicle of Tan Sri Wan Azmi Wan Hamzah, and Selangor’s Kumpulan Perangsang Selangor Bhd’s Viable Chip Sdn Bhd (30%).
The state’s Menteri Besar Inc has a golden share in Splash, which makes money from the water concession.
The federal government cannot afford a total breakdown in negotiations. PAAB, which is tasked with managing the country’s water assets, has a RM6.1 bil debt (as of end-FY15) taken out to fund the purchase, and it will have to depend on the finance ministry to fulfil its repayment obligations if the deal does not happen. PAAB’s ability to continue as a going concern will, to an extent, depend on whether it gets the stake in Splash.
While all this is going on, Selangor residents are the ones who suffer from water shortage due to no fault of theirs. Both the federal and state governments should stop holding the 1.6 million Selangor residents hostage and resolve the deadlock as soon as possible.
as stated very clearly , fed cannot force to take over if selangor govt have not make an offer to splash
if selangor govt make an offer, but splash reject it, then it is different case. Fed can start the force takeover. but if fed force to takeover splash without any prior offer made, then the Fed will be accused of robbing other people asset. This will be bad for the bond market bcos splash have many bondholders.
Therefore, i think selangor govt will still make a 1x book value offer to splash so that nobody accused them of not being fair . This 1x book value is a standard value given by other states also when there take over the water player.
with or without splash deal, current PE ratio is low due to recent qtr results are doing good, to me TP is around 1.80 using recent EPS, if Splash deal is done once announced on this 5th Oct, then price will be rocket fly on this Friday.
At this price, should be a good bet, just 2 cent view.
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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....
rogers123
4,017 posts
Posted by rogers123 > 2017-09-19 21:02 | Report Abuse
Yesterday up may be due to the important announcement made by NJIB at 4.45pm. But suddenly.....thing went wrong