The Malaysian Insight

KHAZANAH Nasional Bhd will likely reject an offer from a Hong Kong-based private equity firm to buy its stake in PLUS Malaysia Bhd, said government sources today.

The sources confirmed there was indeed an offer from RRJ Capital to acquire Khazanah’s share in the highway concessionaire, but said the price was too low.

“The offer of RM3 billion is too low and Khazanah will not agree to it,” a source told The Malaysian Insight.

It was reported in The Edge today that should RRJ’s bid be accepted, the company would reduce toll rates by 20% across the board.

The report also said RRJ’s proposal was submitted to Khazanah and to Works Minister Baru Bian last week.

Attempts by The Malaysian Insight to get a response from Baru were unsuccessful.

The finance minister’s political secretary, Tony Pua, meanwhile, confirmed the offer and that Khazanah and the Works Ministry were in the midst of providing the details.

Khazanah replied by email to The Malaysian Insight saying that there were several proposals for the highways and that it had submitted its own to the government.

“Ultimately, the proposals are for the government to consider and decide what is best for the country and the people,” the email said.

Khazanah did not disclose which parties were aiming to acquire PLUS.

Khazanah, through UEM, owns a 51% stake in PLUS. The Employees’ Provident Fund (EPF) owns 49%.

RRJ proposes to fully acquire PLUS, including the right to issue redeemable convertible unsecured loan stock via Lebuhraya Usahasama Bhd, a wholly owned subsidiary of PLUS.

PLUS is about RM3 billion in debt. RRJ’s offer reportedly offers UEM and EPF significant returns.

RRJ was incepted in 2011 by Malaysian brothers Richard and Charles Ong with a capital of US$15 billion (RM62 billion) . – October 3, 2019.