Puncak Niaga, Selangor reach deal on water takeover
(Malay Mail Online) – The Selangor state government today announced that water concessionaire holder Puncak Niaga Holdings Berhad has agreed in principle to the state’s offer to take over of its assets and operations.
In a statement, the mentri besar’s office confirmed that the company — which runs Puncak Niaga (M) Sdn Bhd (PNSB) and Syarikat Bekalan Air Selangor Sdn Bhd (Syabas) — had informed the state of its decision in a letter dated June 6.
The deal leaves Syarikat Pengeluar Air Selangor Holdings Bhd (Splash) as the only concessionaire which has yet to agree to the state’s takeover bid.
“Both parties have agreed on the indicative terms of the takeover offer for 100 per cent equity of PNSB and 70 per cent equity of Syabas for a net cash consideration of RM1,5553 million (RM1.55 billion),” the statement said.
Under the deal, the state government will take over Puncak Niaga’s entire equity stake in both PNSB and Syabas including all assets and corresponding liabilities, excluding assets, liabilities and businesses under PNSB that are not water-related.
PNSB and Syabas had initially rejected the state government’s takeover bid issued on February 26 this year.
The two companies, along with Splash, rejected the state’s offer and instead demanded for higher payouts at 15 per cent return on equity instead of the 12 per cent offered.
They also wanted to be compensated in full for not being allowed to raise water tariffs.
Only state-owned concessionaire, Konsortium Abbas Sdn Bhd, agreed to the initial offer by the time it expired on March 21.
The refusal prompted Selangor and federal governments to consider invoking powers under the Water Services Industry Act (Wasia) 2006 that allow a forced takeover of water assets by Putrajaya.
The mentri besar’s office today noted, however, that the takeover of both PNSB and Syabas is conditional upon approval of Puncak Niaga’s shareholders at an extraordinary general meeting expected to be convened soon.
Mentri Besar Tan Sri Khalid Ibrahim said briefly in the statement that once the state completes the takeover process of all water assets, it will look into the process of offering water shares up for public subscription.
He thanked the Energy, Green Technology and Water Ministry for their help in finalising Selangor’s ambitious water industry restructuring plan, and repeated the state government’s pledge to return the favour in the construction of the long-delayed Langat 2 water treatment plant.
“I will co-chair a meeting on Langat 2 with Minister Datuk Seri Panglima Dr Maximus Ongkili on Thursday,” Khalid said in the statement.
