In the end, I feel Spore will end up paying for 1MDB! Thro HSR

[Sammyboy RSS Feed]

An honorable member of the Coffee Shop Has Just Posted the Following:

1MDB president and group executive director Arul Kanda said after the disposal of Edra Energy Global Bhd, 1MDB’s remaining debts will be RM25 billion.

“The next step in the rationalisation plan would be the sale of the 60 per cent stake in Bandar Malaysia Sdn Bhd, of which the definitive agreement is expected to be signed by year-end,” he told Business Times, Berita Harian and TV3 in an interview yesterday.

Arul Kanda said 1MDB has shortlisted two potential buyers for the Bandar Malaysia stake.

“One is a 100 per cent local company and the other is a consortium consisting of 70 per cent local and 30 per cent foreign interest.

“Bandar Malaysia is currently valued at RM10 billion-RM11 billion and we plan to maintain the other 40 per cent. This is in line with our aim to avoid borrowing to conduct future projects,” he added.

Arul Kanda said the company plans to keep its 100 per cent stake in the Tun Razak Exchange (TRX).

He said TRX will be a transportation hub where the high-speed rail (HSR) between Kuala Lumpur and Singapore will merge with other transportation services such as the Mass Rapid Transit, the KTM railways, Rapid Transit as well as provide links to the SMART tunnel and the Maju Expressway.

“1MDB will be focusing on property developments — TRX and Bandar Malaysia projects — which are seen as value-accretive for the company,” Arul Kanda said.

He added that the RM16 billion from the asset swap with Abu Dhabi’s International Petroleum Investment Co (IPIC), to be completed by June next year, will slash another large portion of 1MDB’s debts.

Although the RM16 billion debt will still be visible in 1MDB’s accounts, the debt repayment will actually be taken over by IPIC, Arul Kanda said. IPIC had earlier made interest payments on the two bonds worth US$1.75 billion (RM7.4 billion) each belonging to 1MDB.

“The rationalisation plan does not involve any government aid, which means it will not burden the rakyat. By the end of this year, it is a done deal for 1MDB,” he said.

Meanwhile, on the Edra Energy sale, Arul Kanda said electricity tariffs will not be affected after the takeover of power assets by CGN as it is governed by the power purchase agreements (PPAs).

“According to the PPAs, CGN has no right to increase tariffs. If they fail to comply, Tenaga Nasional Bhd (TNB) has step-in rights, which gives TNB the right to take over the power assets,” he said.

Arul Kanda said having more independent power producers in Malaysia can be beneficial to the rakyat as it will provide a more competitive tariff in the country.

The takeover of power assets by CGN, which is expected to be completed in three months, will give the Chinese firm 14 per cent market share of the country’s power stations.


Click here to view the whole thread at www.sammyboy.com.