RAM Rankings: Govt’s nod to restructure concessionaires provides hope for freeway sector


KUALA LUMPUR: The federal government’s settlement to a restructuring proposal involving 4 freeway concession firms within the Klang Valley provides hope for the broader freeway sector, mentioned RAM Score Providers Bhd.

The proposal, which suggests no extra toll charges hike for 4 highways within the Klang Valley, entails freeway concessionaires Syarikat Mengurus Air Banjir dan Terowong Sdn Bhd (SMART Tunnel), Kesas Sdn Bhd (Kesas Expressway), Sistem Penyuraian Trafik KL Barat Sdn Bhd ( SPRINT Expressway), and Lingkaran Trans Kota Sdn Bhd (Damansara-Puchong Expressway or LDP).

In an announcement at the moment, RAM Rankings mentioned continued toll hike deferment in a single 12 months was reportedly costing the federal government RM2.25 billion in compensation whereas its narrowing fiscal headroom makes the abolition of tolls implausible, contemplating the excessive compensation sums payable.

“Accordingly, Amanat Lebuhraya Rakyat Bhd (ALR), in providing to amass highways partly owned by Gamuda Bhdhas, in our view, signaled a stronger intent by the federal government to noticeably deal with the restructuring of toll charges throughout highways by end-2023, based mostly on a nationwide parliamentary response by the Works Ministry.

“If profitable, this restructuring mannequin may function a blueprint for additional renegotiations of different expressway concessions,” it mentioned.

The score company mentioned that ALR’s proposed resolution to the deadlock within the sector, by way of the acquisition of 4 highways partly owned by Gamuda for RM5.48 billion, would obtain completely different however complementary aims together with decreasing the burden on the general public from a price inflation perspective.

The proposal additionally supplies some respite towards the federal government’s ballooning annual compensation invoice for non-revision of scheduled toll charges, and takes into consideration the pursuits of different stakeholders together with lenders and shareholders, RAM Rankings mentioned.

The company additionally famous that the tenures of the 4 freeway concessions are anticipated to be restructured and lengthened. – Bernama

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