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AWSJ: Sale of Stake in Malaysian Rail Project
By Kapal Berita
14/10/2000 3:50 am Sat
Bayangkan berapa banyak projek istimewa dan wang istimewa yang dapat
dicekup oleh rakan diktator tua... tetapi semuanya berakhir dengan
ukiran muram dimuka SESIAPA sahaja...
From Asian Wall Street Journal
Sale of Stake in Malaysian Rail Project
Doesn't Stop Firm's Expansion Efforts
By LESLIE LOPEZ Staff Reporter of THE WALL STREET JOURNAL
KUALA LUMPUR, Malaysia -- Malaysian businessman Vincent Tan Chee Yioun
of the Berjaya group of companies has sold his roughly 30% equity
interest in a long-delayed light-rail project in Kuala Lumpur.
Bankers and financial executives close to the businessman said that
Tan Sri Tan, as he is known, sold his equity in privately held KL PRT
Sdn. Bhd. two months ago to a group of investors for about 30 million
ringgit ($7.9 million). "It's a tough business, so we got out" said a
Berjaya executive close to Tan Sri Tan. He declined to identify the
Tan Sri Tan's departure isn't stopping KL PRT's other main promoter,
David Chew Keat Soon, from trying to expand the company's
transportation business, however. Several government officials said
that KL PRT has submitted a proposal to Prime Minister Mahathir
Mohamad's government to build a light-rail system in the country's
sprawling new administrative capital of Putrajaya and, at the same
time, to manufacture railcars for the system locally.
Government officials said the new KL PRT proposal is being studied.
They declined to estimate the cost of the Putrajaya project.
Private-sector executives familiar with Mr. Chew's plans said that the
businessman will be seeking funding -- estimated at more than 600
million ringgit -- under a government assistance program for
infrastructure projects to help finance the Putrajaya rail system and
to build a facility to produce the railcars. KL PRT has already
received about 400 million ringgit in government funds for the
construction of its light-rail system -- featuring a monorail -- in
Kuala Lumpur. Construction began in 1996 but has been repeatedly
delayed and is far from completion.
Mr. Chew is associated with Malaysia's more audacious infrastructure
undertakings in the 1990s, including the privatization of the
country's sewerage system. That project was awarded to a company
controlled by associates of Tan Sri Tan in 1993. Together with Tan Sri
Tan, Mr. Chew was also the promoter of a now-abandoned plan to build
the world's longest building on stilts above a river flowing through
Mr. Chew didn't respond to requests to discuss his latest plans. But
bankers and some government officials expressed skepticism over Mr.
Chew's Putrajaya light-rail and railcar manufacturing proposals.
Bankers note that passenger traffic in Kuala Lumpur and Putrajaya
probably won't be sufficient to fund the cost of building the network
for years to come. Currently, Kuala Lumpur's two other privately owned
light-rail networks are in the process of being taken over by the
government because they can't meet their debt obligations.
The bankers and government officials also suggest that Mr. Chew's
earlier projects haven't panned out as planned. Since the national
sewerage project was handed over to the private sector, it has been
plagued with problems and ownership of the venture has changed hands
several times. It was recently taken over by the government.
Mr. Chew's and Tan Sri Tan's plan to build the longest building, a
ten-story, two kilometer-long structure called the KL Linear City
project, was scrapped after Asia's economic crisis hit in mid-1997.
Another possible handicap for Mr. Chew's new endeavors is the loss of
his powerful patron, Tan Sri Tan, as a partner. Tan Sri Tan, who is a
close friend of Prime Minister Mahathir, was instrumental in paving
the way for Mr. Chew to pitch his earlier projects to government
Write to Leslie Lopez at email@example.com