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UPDATED @ 08:32:04 PM 31-07-2012
July 31, 2012
KUALA LUMPUR, July 31 — A consortium led by George Kent, the company at the centre of repeated opposition allegations that it received preferential treatment from the government, was announced today as the winner of the lucrative deal to build the Ampang Line LRT extension, confirming earlier reports that it would be the recipient of the contract.
Syarikat Prasarana Negara Berhad (Prasarana), the project and asset owner for the LRT Line Extension Project (LEP), said in a statement today that the contract for “Engineering, Procurement, Construction, Testing and Commissioning of System Works” for the Ampang Line Extension Project has been awarded to a George Kent-Lion Pacific joint venture.
Prasarana did not say how much the George Kent deal was worth, but pointed out that the entire project would come in below the original budget of RM7 billion.
PKR’s strategy chief Rafizi Ramli has repeatedly accused the prime minister of allegedly interfering in the tender bid and granting the multimillion contract to George Kent, which he claimed was controlled by a “close associate” of the prime minister and which also scored one of the lowest points in the technical and commercial evaluation for the project.
Prasarana didn’t directly address PKR’s concerns over George Kent’s lack of a track record in rail projects and its allegedly higher costs but said in its statement that the winning joint venture (JV) “is well supported by reputable local and international multi-disciplinary technical partners all with proven track records in their respective field of systems implementation expertise.”
It added that some of the key sub-systems proposed also have synergy with Prasarana’s current operations, allowing it to reduce operating expenditure.
Little is known about George Kent’s JV partner, Lion Pacific.
A search using the Companies Commission of Malaysia’s online information service turns up two possible companies — Lion Pacific Sdn Bhd and Lion Pacific Engineering but it is unclear if these two are involved in the JV.
According to documents provided by the Companies Commission, Lion Pacific had a revenue of RM15.7 million for the 2010 financial year with a profit of RM100,279.
Lion Pacific Engineering, meanwhile, reported no revenue for the 2010 financial year and a loss of RM1,000.
According to George Kent’s annual report, its major shareholders are the husband-and-wife team of Tan Sri Tan Kay Hock and Puan Sri Tan Swee Bee, who together hold a combined direct and indirect stake of about 70 per cent in the company.
The annual report further states that it is an engineering company whose core expertise was in water infrastructure projects but that it was looking to expand into rail and green technology sectors in line with the Najib administration’s Economic Transformation Programme.
For the 2012 financial year ended January 31, the group reported a profit of RM19.3 million on the back of RM152.2 million in revenue.
Rail projects have increasingly come under the spotlight due to the billions of ringgit that are involved, as the country embarks on a rail expansion drive that not only includes the extension of KL’s LRT system but also the new Klang Valley MRT, the southern rail double-tracking project and a possible high-speed rail line to Singapore.
The MRT project tender process was also recently hit by criticism after several multi-national vendors reportedly decided not to participate in the bid to supply rolling stock for the project, citing concerns over favouritism.
Financial weekly, The Edge, also reported in April that the high financial stakes involved in the massive boom in rail infrastructure in the country could lead to a shift in the country’s political landscape and the carving up of the Transport Ministry with MCA losing control of the rail and road sectors.
Prasarana has now awarded all works contracts under the LEP, except for the access card system, which has yet to come up for tender.
Following the completion of the LEP, the Ampang Line will be extended by an additional 17.7-km elevated track; starting from the current Sri Petaling Station and serviced by 11 new stations and two future stations.
The project also includes the purchase of new six-car trains for Ampang Line.
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