(The Star) – A frustrated Puncak Niaga Holdings Bhd (PNHB) executive chairman Tan Sri Rozali Ismail said the company may sue the Federal and Selangor state governments if the long-drawn water restructuring exercise in Selangor is not completed by the new July deadline.
“If they (the Federal and Selangor state governments) cannot resolve the issue, we might as well do the messy thing. Let us settle it in court,” Rozali told reporters after the company AGM.
PNHB on Monday gave its sixth extension until July 13, 2015 to the Selangor government to fulfill the conditions precedent in the agreement dated Nov 11, 2014.
Rozali said the company was not keen on giving further extension.
Under the deal, PNHB would hand over the Selangor water concession businesses of subsidiaries Puncak Niaga Sdn Bhd as well as Syarikat Bekalan Air Selangor Sdn Bhd (Syabas) to the state government for RM1.56 bil.
Rozali said PNHB would not ask for a higher price regarding the deal.
“We thought of it. But our shareholders and board said if there were further delays, it would cause us loss of business opportunities. There might also be implications to consumers in tariffs.”
Rozali also said he believed the Federal government would invoke the Water Services Industry Act (WASIA) to compel Selangor to proceed with the water deal, if the situation was not resolved soon.
“In an emergency, the Federal Government can take over everything. I think they will do that because now, it is already an emergency (reserve margin for treated water is now below 1%). And if that happens, we will pursue our civil suit against the state government. So, our company, the Federal government and state government will fight. It will be a legal battle. Very messy. Everybody goes to court – injunctions, claims.”
However, Rozali also said he thought a deal between the Federal and state governments was “almost there.
“They have resolved most of the issues except small ones. So, hopefully, in one or two weeks…”
Meanwhile, in a statement, PNHB said once the Selangor water restructuring issue was resolved, the company’s water treatment business would mainly consist of its projects in China which comprised two water treatment concessions expiring in 2038 and 2039, and one wastewater treatment concession expiring in 2035.
Rozali said PNHB was talking to companies in the oil and gas sector, concerning possible acquistions.
“Even though oil and gas is now not very good, I think that in the long term, the price will recover. We are talking to some companies who have problems – who don’t want to do this highly technical oil and gas business anymore.”
He also said PNHB was evaluating palm oil plantations in the country.
“We are waiting till a good time. At this time, land price is still high. Our consultants said wait for a while and get a good price (for palm oil plantations).”
PNHB ended trading on Tuesday at RM2.63, up 5 sen.
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