Thursday, May 29, 2008

Wijaya ... May 2008

What’s Up!

WIJAYA Baru Global Bhd has signed a memorandum of understanding (MOU) with a Vietnamese authority to bid for infrastructure projects worth an estimated US$3 billion (RM9.8 billion).

The elevated highway, flood mitigation and water treatment plant will be undertaken on a build-and-manage basis, while the solid waste treatment plant and garbage collection projects will be carried out on a build-operate-transfer. The potential jobs in three districts in Ho Chi Minh City include the construction of an elevated highway, flood mitigation, a water treatment plant, solid waste treatment and garbage collection.

It is conducting a viability study, to be completed by the year-end (2008), on the projects. The projects will be nothing less than US$3 billion. They have the first right of refusal for the projects. If Wijaya Baru finds the projects viable, it will look for a Vietnamese partner and hold the majority stake in the formation of a joint-venture company.

Its 45 per cent associate, Wijaya Baru Sdn Bhd, is expected to be the main sub-contractor of a RM300 million flood mitigation project in the East Coast. Wijaya Baru expects to receive up to 80 per cent of the RM300 million job. They have signed an agreement with a friendly party who has been given a letter of intent for a flood mitigation project in the East Coast. A letter of award is expected to be given in the next two weeks to 30 days.

The party has carried out all the designs, finished all negotiations and sent them to the Ministry of Finance and is awaiting the Letter of Award. The flood mitigation project, expected to commence in June 2008, will take about three years to be completed.

Meanwhile, Wijaya Baru (through its associate) is expected to complete the RM340 million flood mitigation project awarded to it in August 2007 by February/March 2009.

They are also talking to the relevant authorities for the second phase of the Selangor flood mitigation that we are carrying out right now. They have started doing the design. They have been told to come out with the technical proposal on the areas that they need to look at to address the flood problems in the lower Klang Valley. Expecting the news on the award of the project with an estimated value of RM1 billion, to be announced later 2008.

To solve the problem at the Sungai Damansara catchment, you need to spend a minimum of RM1 billion to have 100 years of protection. Wijaya Baru also saw opportunities in Pahang, Kedah, Johor and Malacca.

They want to specialise in flood mitigation projects. The company, which derives most of its revenue from timber, anticipates a large portion of its profits in 2008 to come from infrastructure projects.

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