AMICABLE SOLUTION: Puncak expects to sell concession to state govt by December at the earliest
Selangor's water sector deadlock could be over soon, with the state government and concessionaires expected to seal a takeover deal in December at the earliest.
Sources with direct knowledge on the matter said Puncak Niaga Holdings Bhd is close to selling its concession to the state government.
Puncak is the biggest water concessionaire in Selangor via Puncak Niaga (M) Sdn Bhd and Syarikat Bekalan Air Selangor (Syabas).
Syabas is a water distribution concessionaire while Puncak is a water treatment concessionaire.
The state’s other concessionaires are Syarikat Pengeluar Air Sungai Selangor Sdn Bhd, Konsortium ABASS Sdn Bhd and Konsortium
Air Selangor Sdn Bhd. All three are water treatment concession companies.
Sources told Business Times yesterday that Puncak and the state government are close to reaching an amicable solution.
“A firm deal is highly likely to go through. It is just a matter of time,” one of the sources said.
“The price should be more than the RM9.5 billion that is being offered by the state government to all concessionaires,” the source added.
The Selangor government made its third bid on February 20 to take over the four major water concessionaires for RM9.65 billion.
Its first bid of RM5.7 billion in 2009 and second bid of RM9.2 billion in 2011 were rejected by all parties.
Sources said talks between Puncak and the state government also include the long-delayed Langat 2 water treatment plant project.
The Langat 2 plant will treat raw water from Pahang and supply it to households and industrial areas in Selangor, Kuala Lumpur and Putrajaya.
The water demand in these areas is growing at about four per cent annually.
Existing water treatment plants in the areas can only cater to current needs, another source said, claiming that the water reserve capacity stands at an alarming one per cent.
“The water treatment plants are already operating beyond their capacity and if anything were to happen to them, there will be water disruption in several areas,” the source said.
The ideal water reserve capacity for Malaysia is about 20 per cent, the source added.