Integrax ... Nov10

Integrax Bhd which operates the Lumut Port believed that the termination of a shareholders agreement in relation to the Lumut Maritime Terminal Sdn Bhd (LMTSB) would have limited impact on its operations.

Integrax stated that all operations of LMTSB were conducted onsite by personnel based in Lumut. The company believes that the operational impact will be limited given that the team of operational personnel actually and physically involved in port operations at LMTSB and in the operation and maintenance of Lekir Bulk Terminal Sdn Bhd (LBTSB) remain unchanged at this time.

Further, the company through its appointed LBTSB owner’s representative based at the terminal (LBTSB), continues to monitor the efficacy of LMTSB in carrying out its contractual obligations to LBTSB.

Integrax was clarifying its announcement where the company stated that it had received a notice from Taipan Merit Sdn Bhd (TMSB) unilaterally terminating the shareholders agreement between the company (Taipan Merit) and Pelabuhan Lumut Sdn Bhd.

Pelabuhan Lumut — a wholly owned subsidiary of Integrax — has a 80% stake in LBTSB and 50% minus one share in LMTSB. The remaining interest in LMTSB is owned by TMSB, a wholly owned subsidiary of Perak Corp Bhd.

LMTSB is the owner and operator of Lumut Maritime Terminal that provides total integrated port services and facilities. It also develops and sells industrial land which is adjacent to LMT.

LBTSB, which is a cash cow in Integrax, is the port that handles the coal traffic at Lumut to be supplied to the Janamanjung power plant owned by Tenaga Nasional. LMTSB is paid to run the terminal operations of LBTSB.

Perak Corp stated in an announcement last week that the termination of the shareholders agreement between Pelabuhan Lumut and TMSB would not affect the operations and maintenance agreement with regard to LBTSB.

The latest dispute between Integrax and Perak Corp revolves around the appointment of the CEO for LMTSB.

Perak Corp in an announcement last week alleged that Integrax’s chairman and co-CEO, Harun Halim Rasip and Capt Ng Ber Toon, acting on instructions and as representatives of Integrax, assumed the powers of the CEO of LMTSB.

The company further stated that according to the shareholders agreement, Integrax’s responsibility is to nominate the CEO of LMTSB but it must be acceptable to the board of LMTSB.

But things have not been smooth between some shareholders in Integrax of late.

On Oct 19, Integrax announced that the transshipment agreement between LBTSB and Vale International SA (Vale) had lapsed and the company did not intend to pursue the matter any longer.

Under the agreement, LBTSB is to handle the transshipment of iron ore brought in by Vale into Lumut for further distribution to other countries in the region.

The reason why a faction headed by Harun is not keen on the project is because Integrax would incur an investment of about RM280 million in building the port facilities to handle the iron ore.

The amount, according to officials familiar with the deal, has to be recovered in the next few years as Vale itself is building its own facilities.

Effectively their contention is that Integrax, in building the new facilities, will only act as a buffer for Vale.

But the opposing side, which is led by Amin Halim Rasip, who is the younger brother of Harun, is of the view that the Vale project will bring long-term development to not only Integrax but the whole vicinity, something that is in the interests of the state government.