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Putrajaya launches RM6b bid to acquire four highway operators
Published:  Jun 21, 2019 9:26 PM
Updated: 2:26 PM

Government body Minister of Finance Incorporated (MOF Inc) today issued letters of offer to buy over four highway concessionaire companies.

According to separate filings with Bursa Malaysia by Gamuda Bhd and Lingkaran Trans Kota Holdings Bhd (Litrak Holdings), MOF Inc issued letters of offer to Kesas Holdings, Sprint Holdings, Litrak Holdings and Smart Holdings.

Based on the filings, it would appear that Putrajaya was offering up to RM6.2 billion to acquire these companies.

This could signal Putrajaya's first step towards lowering toll charges.

Pakatan Harapan had pledged to abolish toll charges in stages in its GE14 election manifesto.

In February, Putrajaya revealed that it was in talks with Gamuda Bhd to acquire four highways in which the company has a majority stake in.

Based on the filings today, the four highways are likely to be the Damansara-Puchong Expressway (LDP), the Western KL Traffic Dispersal System (Sprint Expressway), the Shah Alam Expressway (Kesas) and the Smart Tunnel.

Previously, Finance Minister Lim Guan Eng had revealed that the four highways had a total 48 percent market share of urban tolled roads market (not including those operated by Plus Malaysia Bhd) based on toll revenue collected.

Lim had said that he hoped the companies would be acquired at a "fair and reasonable price".

He also said that the acquisition, if successful, would save the federal government RM5.3 billion in compensation to highway operators. 

According to the Prime Minister's Office in February, the initial plan was to introduce a "congestion charge" system whereby existing toll charges would only be applied during peak hours.

There would be no toll charges during the off-peak period from 11 pm to 5 am. Toll charges during all other periods would be subjected to a 30 percent discount.

At the time, the PMO said toll charges were necessary to maintain the highways and repay concessionaire loans. Any surplus would be used to improve the quality of public transport, it added.