DISPOSAL TALK QUASHED: Fund is holding on to the (42.2pc) equity for now, says an official
The Employees Provident Fund (EPF) has dismissed talk that it is planning to sell its entire stake in Malaysian Resources Corp Bhd (MRCB), a property and infrastructure developer.
Speculation has been rife that EPF is looking to dispose of its stake in MRCB, the reason being the company has not won any major government projects since a year ago.
MRCB is the developer of KL Sentral, an integrated transport hub with a gross development value of over RM8 billion. The project is slated to finish in 2016.
KL Sentral is the only current development for MRCB, which is 42.2 per cent owned by the EPF.
Analysts say MRCB will be in troubled waters if it does not win any job soon, given that the earnings from the project will be recognised in about three to four years.
The last big win for MRCB was in August 2011 when it won a RM1.33 billion contract for the Ampang light rail transit (LRT) extension project.
Business Times reported two months ago that MRCB is expected to win a RM1 billion job for the Sungai Buloh-Kajang MY Rapid Transit (MRT) line.
But project owner Mass Rapid Transit Corp Sdn Bhd (MRT Corp) said the award of the contract to build viaduct guideways between the Taman Mesra and Kajang stations is subject to government approval.
It was also reported that MRCB has emerged as the frontrunner to develop a prime 8.09ha site on Jalan Bangsar in Kuala Lumpur where the Unilever headquarters and factory once sat.
However, an MRCB official said it will not be landing the job, declining to elaborate.
"We believe there is something going on in MRCB - from its chief resigning to not winning major jobs. The only good thing is that the government is taking over its expressway project," the analysts said.
MRCB chief executive officer Datuk Mohamed Razeek Hussain tendered his resignation in July. MRCB has yet to announce the appointment of a new CEO.
Last Thursday, the government said it will take over the Eastern Dispersal Link built by MRCB at a cost of RM1.4 billion, to settle the issue on toll charges.
MRCB's share price closed unchanged yesterday at RM1.75, with 4.48 million shares traded. The stock has been trading between RM1.60 and RM1.79 the past one month.
"We think MRCB should move into the private sector to survive, whether or not the EPF sells its stake in the company," said one analyst.
The company is studying a proposal by private developer Nusa Gapurna Development Sdn Bhd to buy into a project the latter owns, in exchange for a 20 per cent stake in MRCB.
Nusa Gapurna's prime asset is the 16ha land behind PJ Hilton in Petaling Jaya, where the construction of PJ Sentral Garden City, a multi-billion ringgit project, will start next year.
By Business Times