TALAM in trouble? Water stocks in deadlock again

The Selangor government has given Talam Corporation 3 months to settle a total of RM391m in debts owning and dueto the state for its failure to deliver on a number of projects, said Menteri Besar Tan Sri Khalid Ibrahim. Simultaneously,the state assembly yesterday approved a supplementary budget of RM391m to Menteri Besar Inc (MBI) pursuant to the debtrecovery exercise. MBI will buy the debt from the state government and assume responsibility to recover the debt owning fromTalam. Khalid said the RM391m debt owning from Talam stemmed from several real estate development joint ventures withstate subsidiaries over the past 10 years. The debt collected will be injected into the state consolidated funds. Khalid said thestate would undertake an audit of the state subsidiaries accounts and had determined that over RM500m was owing to Talam,which disputed the figure. He added that both parties settled for RM391m. (Financial Daily)

After several failed attempts, the Selangor government has finally given up on its planned acquisition of the state’swater assets and is now in discussions with Pengurusan Aset Air Bhd (PAAB) to consolidate the water industry.Selangor Menteri Besar Tan Sri Khalid Ibrahim said the contentious issues expected would be the valuation of the water assets(an estimated price between RM7bn and RM11bn) and control over distribution rights. Asked what his asking price is, Khalidreplied: “RM11bn.” The Pakatan Rakyat-led state government had wanted to undertake the exercise itself, before selling theassets to PAAB, to have a better control of distribution rights. Khalid said the state had to concede to the operators sellingdirectly to PAAB after Puncak Niaga Holdings Bhd (PHNB) rejected the state’s latest offer to take over its water assets andliabilities, although Gamuda Bhd and Konsortium Abass Sdn Bhd had accepted the offer. Khalid is confident that PAAB wouldwant to “work together” with the state on the water consolidation exercise, as they too had to cooperate with each other,particularly on the supply of water from Pahang whereby the acquisition of land would be an issue. (Financial Daily)