Selangor to exercise minority power in concessionaires to reject toll hike

Selangor Menteri Besar Azmin Ali says the state government will exercise its shareholder power in two highway concessions to block the toll hike – a move to protest against the Federal government allowing the increment. – The Malaysian Insider filepic, October 15, 2015.

Selangor Menteri Besar Azmin Ali said the state government would exercise its shareholder power in two highway concessions to block the toll hike – a move to protest against the Federal government allowing the increment.

In a press statement today, Azmin said the state government has utilised its minority powers to call for a special board meeting to reject the toll increase proposal.

“Even though the state is only a minority shareholder and is not a decision maker, it is the state’s policy to protest on the irresponsible toll rate hike, which is increasing the (financial) burden of the public who are already facing a difficult economic situation and the fall of the Ringgit,” said Azmin.

According to him, the decision to raise toll rates for KESAS and SPRINT highways, in which the Selangor government holds a minority stake, was never discussed at the board meetings.

State-owned Perbadanan Kemajuan Negeri Selangor (PKNS) owns a 30% in Kesas Holdings Bhd, which runs Kesas highways. Gamuda holds the controlling 70% stake.

Also, the state government holds a 20% stake in the concessionaire of Sprint highway, through Perbadanan Kemajuan Negeri Selangor (PKNS). Public-listed Lingkaran Trans Kota Holdings Bhd (Litrak) owns a 50% stake in Sprint, while Gamuda holds a 30%. 

When contacted, sources close to the Menteri Besar’s office admitted to The Edge Financial Daily that being a minority shareholder, the state government might not be able to block the toll hike.

“We know we won’t be able to do much. We are only a minority shareholder in both companies. What we want to do is to register our protest against the toll hike,” said the source who does not want to be named.

Effective today, 18 highways nationwide began increasing their toll rates from between 10 sen to RM4.70.

Azmin Ali said the toll increase is a burden to the public, especially in light of the current economic situation and the rising cost of living.

Azmin added that the state government demands the federal government utilise the GST collection to continue paying reparations to highway concessionaires, without increasing toll rates. – The Edge Markets