KUALA LUMPUR: SILK Holdings Bhd shareholders today approved the sale of Sistem Lingkaran Lebuhraya Kajang Sdn Bhd (SILK) to Permodalan Nasional Bhd (PNB) for RM380 million.
“Our shareholders and bondholders have given the green light to this concession sale to PNB,” said SILK Holdings executive chairman Datuk Mohammed Azlan Hashim.
Following this, he noted the deal is still pending approval from Unit Kerjasama Awam Swasta (UKAS) in the Prime Minister’s Department.
“PNB is conducting due diligence on this purchase. We’ve requested an extension until end-April 2017 to complete this deal,” he told reporters after SILK Holdings shareholders’ meeting held here.
SILK Sdn Bhd is the concession holder of the 37km Kajang Traffic Dispersal Ring Road (SILK Highway) under a 36-year concession which ends on July 31, 2037.
PNB’s existing portfolio of highway concessions is held under its subsidiary Projek Lintasan Kota Holdings Sdn Bhd. The three highways are Ampang-Kuala Lumpur Elevated Highway, Guthrie Corridor Expressway and Kemuning-Shah Alam Highway.
Of the RM380 million proceeds, Azlan said RM200 million will go to strengthen its marine logistics business and future investments.
He also said the board of directors have agreed that 10 sen per share or RM70 million of the proceeds will later be distributed as special dividends.
Apart from its highway division, SILK Holdings is also in the business of oil and gas (O&G) support services.
In May 2016, it ventured downstream and bought three chemical tankers from Boustead Heavy Industries Corp Bhd for RM73.5 million.
“As of right now we have 20 vessels for our O&G support services and three chemical tankers. Going forward, we will continue to invest in the O&G segment despite its volatility as the market is cyclical,” said Azlan.
“What goes down must come up and the O&G segment will continue to be one of the country’s main economic generators,” he added.
As of December 2016, the O&G support services is SILK Holding’s main revenue contributor.
Asked if SILK Holdings would later change its name, Azlan replied, “Yes, it would be a misnomer to carry on with the current name when we no longer own the highway concession, isn’t it?”
“We’re open to suggestions for a new name. We would need shareholders’ approval on the name change,” he added.