Air Selangor denies special treatment for Splash

SHAH ALAM (Aug 10): Pengurusan Air Selangor Sdn Bhd (Air Selangor) has denied allegations that it gives special treatment to Syarikat Pengeluar Air Sungai Selangor (Splash) when it offered the company an acquisition value of RM2.55 billion on Aug 3.

Air Selangor chief executive officer Suhaimi Kamaralzaman (rpt; Kamaralzaman) said that the discount used in acquiring Splash, on the contrary, was much higher compared to the discount used in the takeover of Puncak Niaga (M) Sdn Bhd (PNSB) owned by Puncak Niaga Holdings Berhad in 2015.

“In the PNSB transaction, Air Selangor had paid a price equivalent to 0.86 times of the clean book value, that is a discount of 14% of the clean book value of the water concession assets of PNSB in the transaction, Air Selangor did not take over the non-water concession assets owned by PNSB.

“Meanwhile, in the Splash transaction, the Air Selangor offer value was equivalent to 0.72 times the clean book value of the company, which was a discount of 28% on its clean book value,” he said in a statement here today.

The statement was in response to the claim by former Selangor Menteri Besar, Tan Sri Abdul Khalid Ibrahim, who said the takeover of Splash resulted in the people of Selangor having to pay more than 10 times the price offered by the state government in 2013.

Abdul Khalid also expects the situation to force the state government to review or stop the program of giving free water to all households in Selangor implemented since 2008.

Suhaimi added that the Splash takeover was implemented based on the principles of ‘willing buyer, willing seller’ basis, which requires the seller and buyer to agree to the terms first, before the takeover can be finalised.

“In the current five-year period, Splash shareholders had rejected the proposal to sell at RM250 million, in view of the very big discount on its clean book value,” he said.

According to Suhaimi, based on the value confirmed by three independent bodies appointed by the state government and the federal government, the clean book value of Splash was between RM2.7 billion up to RM3.2 billion.

“RHB Investment Bank which had been appointed by the Selangor State Government, had valued Splash at between RM2.5 billion based on the clean book value on March 31, 2015 and RM3.2 billion based on the Discounted Cash Flow. 

“The international audit firm, Deloitte, which was appointed by the federal government in 2017, had confirmed that the value of the Splash takeover of RM2.7 billion was fair and equitable and based on the financial statement audited by Ernst & Young, the clean book value of Splash at March 31, 2017 was was RM2.8 billion,” he said.

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On Aug 3, Selangor Menteri Besar, Amirudin Shari, said the Splash acquisition process which had long been delayed, was eventually finalised after the concession company had agreed in principle to accept the offer value for the takeover by Air Selangor at RM2.55 billion. 

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