Gamuda’s and MMC Corporation’s joint venture (JV) has been appointed as the project delivery partner (PDP) for the Mass Rapid Transit (MRT) Line 2 from Sungai Buloh to Serdang and Putrajaya.
CIMB Equities Research views the appointment with a big positive and solidifies Gamuda’s position as the biggest beneficiary of the project, with a stronger chance of bagging the estimated RM5 billion underground works, which is likely to be up for tender in 2H15.
The terms and conditions of the appointment will be contained in a PDP agreement to be negotiated and agreed to, which CIMB research expects to be finalised over the next three to four months.
Significance: Based on the assumption that Gamuda is granted PDP fees of 6 percent for MRT 2 (similar to MRT 1), this translates to RM900 million in total PDP fees to be realised over a four to five year period, according to the research house.
IGB REIT’s 3Q14 NPI Jumps 9%
For the third quarter ended 30 September, IGB Real Estate Investment Trust (IGB REIT) posted an 8.8 percent increase in net property income (NPI) to RM80.1 million, on the back of a 4.2 percent rise in gross revenue to RM112.6 million.
The higher gross revenue was mainly due to higher total rental income. Consequently, distributable income for the quarter jumped 10.9 percent to RM69.3 million.
For the nine-month period, NPI and distributable income rose 10.7 percent and 13.4 percent to RM236.3 million and RM203.5 million respectively.
Significance: The manager of IGB REIT intends to increase the income and the value of the investment properties through acquisitions and various management strategies while expecting the financial performance for the year ending 31 December to remain satisfactory.
MSM Eyes JV
MSM Malaysia Holdings, Malaysia’s largest refined sugar producer, is open to any collaboration with local or foreign sugar companies as part of its plans to become a global player, which includes merger and acquisition or any forms of JV.
At the same time, the group denied rumours that MSM is in talks with Tradewinds (M) to buy its Central Sugars Refinery.
In May, MSM entered into a US$250 million (RM818 million) 51:49 JV with Al-Khaleej International as part of its plan to be Asia Pacific’s largest sugar hub. The memorandum of understanding between the two parties is due to expire in the next few days and MSM noted that terms of the deal have not been concluded.
Significance: The JV involves developing a state-of-the-art sugar refinery, as well as a logistics complex and vessel terminal at Port of Tanjung Pelepas in Johor, which will increase MSM’s production capacity to 3.3 million tonnes per year from 1.3 million tonnes upon completion. - Shares Investment
