THE news about private sector groups wanting to buy and take over PLUS Malaysia has not stopped, despite a statement by Khazanah Nasional Bhd managing director and chief executive officer Datuk Shahril Ridza Ridzuan that it has no intention of selling PLUS.
Khazanah acquired the Renong/UEM Group, comprising several subsidiaries with PLUS as its core asset, as a rescue operation in the wake of the Asian financial crisis in 1997-1998.
The group was a politically- linked group and regarded as a success story under the New Economic Policy to strengthen Bumiputera participation in the corporate sector.
But it had financial and governance issues and a heavy debt burden.
The Khazanah rescue enabled PLUS and other companies in the group to be saved and brought under its control.
Following the acquisition, Khazanah took steps to unlock the value in the group through a restructuring, and focused on PLUS.
After a few years of listing on Bursa Malaysia, attracting local and foreign funds, PLUS was delisted at the end of 2011 as institutional investors were becoming anxious that the government was not honouring the toll increase scheduled in the concession agreement.
Thus, from a publicly-listed company owned by hundreds of shareholders, including foreign investors, PLUS was deprivatised and owned by only two shareholders: Khazanah at 51 per cent, and Employees Provident Fund, 49 per cent.
These two led the way for transforming PLUS.
The board prepared the company to face the challenges of the digital revolution, as the directors realised the growing competition PLUS is facing.
It recruited the best talent, adopted a new business plan and invested in technology to take PLUS into the digital age.
PLUS is the largest and oldest toll operator in the country and among the world’s top 10 toll highway companies.
In Southeast Asia, it is considered the most experienced operator in the business.
There is nothing in proposals submitted by private sector bidders to show that they have better ideas to develop PLUS compared with what is being implemented under its business plan.
Speaking as a former PLUS chairman for 18 years, I can say that under the business plan, the company will work with the government and be subject to its approval of the enabling framework of rules and regulations, introduce the multilane free flow traffic system with no toll plazas, install an incentive system of dynamic toll pricing to reduce bottlenecks during peak hours, and implement technology to provide real-time information on road and weather conditions.
It will also provide advice on highway services.
The best equipment will be deployed to mechanise road works and ensure safety for highway users and workers.
Rest and recreation areas in selected locations are being refurbished.
Stall operators, who are mostly Bumiputeras, will benefit from these improvements.
PLUS is a national icon that can add weight to Khazanah’s role as the strategic investment arm of the government.
Khazanah is a national wealth fund with a mission to enlarge assets that are strategic to its expansion so that it can grow to become a major contributor to government revenue.
The Khazanah group’s revenue stream to the Treasury will become progressively larger as Khazanah’s asset base grows in size.
Further, EPF’s 14 million subscribers will benefit as they will get dividends from PLUS’ profits.
Thus, whatever profits PLUS makes goes back to the government and the people through Khazanah and EPF.
PLUS is a national treasure by virtue of its operational excellence as well as its critical role in facilitating Khazanah’s expansion.
As the former Economic Planning Unit director-general, Finance Ministry secretary-general, founding CEO of Khazanah and retired chairman of PLUS, I support Khazanah’s decision not to sell PLUS.
TAN SRI MOHD SHERIFF MOHD KASSIM
Kuala Lumpur