It has secured a contract from Malaysia Airports Holdings Bhd (MAHB) to develop the new low cost carrier terminal (KLIA2) integrated complex on build-operate-transfer concession.
The concession is for 25 years and may be extended for a further 10 years upon expiry. The development of the complex would be undertaken by a special purpose vehicle (SPV) in which WCT and MAHB will hold 70:30 equity interest.
The construction cost of the integrated complex is estimated at approximately RM486 million which the SPV will finance partly via internally generated funds and partly by bank borrowings. The construction of the Integrated Complex is expected to be completed by June 30, 2012.
Under the concession, WCT via the SPV will undertake the design, procurement, engineering, construction, completion, and thereafter, the operation, management and maintenance of the complex for the duration of the concession.
The concession is indeed a good bet for WCT as it will being in recurring income from the retail business, unlike its other local construction projects.
If this momentum keeps up, WCT could diversify earnings and not have to rely completely on one off construction works.
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