Dr M: Govt still mulling takeover of four Klang Valley tolled highways

PUTRAJAYA: The government has yet to decide on whether to acquire four main tolled highways in the Klang Valley held by concessionaire Gamuda Berhad.

"No decision made so far," said Prime Minister Tun Dr Mahathir Mohamad after closing the TVET Conference 2019 themed ‘Human Capital Development To Enhance Future Skills Agenda’ here, today.

The four tolled highways are the Lebuhraya Damansara Puchong (LDP), Sistem Penyuraian Trafik KL Barat (Sprint), Lebuhraya Shah Alam (Kesas) and the Smart Tunnel.

Meanwhile, Finance Minister Lim Guan Eng said that should the government decide to take over the highways at a total cost of RM6.2 billion, it would be done via the issuance of bonds.

Hence, the ministry would not have to allocate a budget for the takeover, he told the Dewan Rakyat.

Prime Minister Tun Dr Mahathir Mohamad arrives for the closing ceremony of the TVET Conference 2019 in Putrajaya. -NSTP/Ahmad Irham Mohd Noor.

Lim explained that the recommended collection of congestion charges would be sufficient to cover the bond repayment and highway operations and maintenance costs; and that the move could save taxpayers RM5.3 billion in compensation to the concessionaire.

Lim’s comments followed an announcement by the Prime Minister’s Office on Feb 25 this year that it was in talks with Gamuda over the potential acquisitions.

The offer to buy over the four highways was accepted by Gamuda’s Board of Directors. The exercise is currently awaiting approval by the concession’s shareholders, as well as final Cabinet approval prior to a successful completion.

Gamuda stands to generate RM2.36 billion of the RM6.2 billion cost of the LDP, Smart Tunnel, Sprint and Kesas. This will be a RM124 million premium on RM2.23 billion which experts estimate is the fair value for Gamuda’s stakes.

Overall, Gamuda is estimated to post a net gain of RM1 billion after netting the acquisition value of RM2.36 billion against the book value of the toll roads attributed to the company’s shareholdings.