Talks between the Selangor state government and Syarikat Pengeluar Air Selangor Sdn Bhd (Splash) will shift to a higher gear following the recent conclusion of the water deal, said AmResearch.

The research house said Selangor Menteri Besar Mohamed Azmin Ali indicated that the state had begun negotiations with Splash and hopes to conclude a deal by July next year.

“We are hopeful that negotiations can be completed in a shorter timeframe compared to that of Puncak Niaga Holdings Bhd,” it said in a note.

The long-drawn water restructuring deal in Selangor finally reached its conclusion following the signing of four agreements yesterday between Pengurusan Aset Air Bhd (PAAB) and Pengurusan Air Selangor Sdn Bhd (PASSB).

This effectively completes the master agreement and the release of RM2 billion from PAAB to PASSB for the acquisitions of Syabas, Permodalan Negeri Selangor Bhd, Konsortium Abass and Splash.

“While the latest development has been expected, we are nevertheless still positive on the news.

“We now wait for a conclusion with Splash for the ultimate closure to the water restructuring exercise in the state. We maintain our ‘neutral’ call on the sector,” it added.

Meanwhile, the water deal conclusion also signals the long-awaited finality of Puncak Niaga Holdings Bhd’s sale of water assets to PASSB for RM1.55 billion.

Another research house, Affin Hwang Capital, views this as a positive development, saying it would finally pave the way for Puncak Niaga to receive the delayed proceeds from the sale of its water assets.

“Puncak will receive RM2.90/share upon disposing of its water assets and it plans to distribute RM1/share in special dividends,” it said in a separate note.

- Bernama