PUTRAJAYA: Pengurusan Aset Air Bhd (PAAB) has acquired Perlis water assets and liabilities for RM203 million, making it the fourth state that has come under the National Water Services Industry Restructuring Initiative after Melaka, Negri Sembilan and Johor.
The deal, which was sealed on Monday, Aug 2, sees PAAB taking over all the state's water-related assets including three water treatment plants, 12 reservoirs, 10 water tanks, a booster station and 1,794km piping network from the state government.
'With this, the state government would not have to repay its debts as it has been novated to PAAB,' Deputy Prime Minister Tan Sri Muhyiddin Yassin, who witnessed the signing ceremony, said.
Also present at the ceremony were Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, Minister of Energy, Green TECHNOLOGY [] and Water Datuk Seri Peter Chin Fah Kui, Perlis Menteri Besar Datuk Seri Dr Md Isa Sabu and PAAB chairman Datuk Seri Tajol Rosli.
The agreements were penned by the chief secretary for treasury Tan Sri Dr Wan Aziz Wan Abdullah, Perlis state secretary Datuk Azizan Hamid and PAAB CEO Datuk Ahmad Faizal Abdul Rahman.
In addition to the acquisition, PAAB had allocated RM24 million for capital expenditure (capex) as part of the ninth Malaysian Plan to improve the state's water assets, said Muhyiddin.
'55% of the clean water pipes in Perlis are made from asbestos, which contributed to the high non-revenue water (NRW) in the state at 44.7% last year. With the restructuring deal, we hope to decrease the rate,' he added.
The water assets were acquired at one times book value by equating to the value of liabilities which was the same basis PAAB applied in taking over the assets in Melaka, Negri Sembilan and Johor.
PAAB is a government-owned company under the Minister of Finance Inc, which was set up in May 2006 to restructure and consolidate the country's fragmented water sector, with the policy making it the owner and the operations and maintenance (O&M) 'asset-light'.
Following the acquisition, the water assets would be leased to Syarikat Air Perlis Sdn Bhd (SAP) for a yearly rental rate of 3% for current assets and 4% for new assets. The asset rate would also be revised every three years, added Muhyiddin.
With the deal sealed for Perlis, PAAB now have RM6.3 billion worth of water assets in its books.
Ahmad Faizal said PAAB was still in negotiations with the Selangor state and federal governments to acquire the Selangor water assets.
'We are still negotiating on the policy level, and if all works well, we should be able to conclude it by the end of the year,' he told The Edge Financial Daily.
Ahmad Faizal had previously said it hoped to acquire all water assets in the country by the end of the year. He has also indicated that the remaining water assets in Kelantan, Perak, Pahang and Selangor are worth between RM10 billion and RM15 billion.
The deal, which was sealed on Monday, Aug 2, sees PAAB taking over all the state's water-related assets including three water treatment plants, 12 reservoirs, 10 water tanks, a booster station and 1,794km piping network from the state government.
'With this, the state government would not have to repay its debts as it has been novated to PAAB,' Deputy Prime Minister Tan Sri Muhyiddin Yassin, who witnessed the signing ceremony, said.
Also present at the ceremony were Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, Minister of Energy, Green TECHNOLOGY [] and Water Datuk Seri Peter Chin Fah Kui, Perlis Menteri Besar Datuk Seri Dr Md Isa Sabu and PAAB chairman Datuk Seri Tajol Rosli.
The agreements were penned by the chief secretary for treasury Tan Sri Dr Wan Aziz Wan Abdullah, Perlis state secretary Datuk Azizan Hamid and PAAB CEO Datuk Ahmad Faizal Abdul Rahman.
In addition to the acquisition, PAAB had allocated RM24 million for capital expenditure (capex) as part of the ninth Malaysian Plan to improve the state's water assets, said Muhyiddin.
'55% of the clean water pipes in Perlis are made from asbestos, which contributed to the high non-revenue water (NRW) in the state at 44.7% last year. With the restructuring deal, we hope to decrease the rate,' he added.
The water assets were acquired at one times book value by equating to the value of liabilities which was the same basis PAAB applied in taking over the assets in Melaka, Negri Sembilan and Johor.
PAAB is a government-owned company under the Minister of Finance Inc, which was set up in May 2006 to restructure and consolidate the country's fragmented water sector, with the policy making it the owner and the operations and maintenance (O&M) 'asset-light'.
Following the acquisition, the water assets would be leased to Syarikat Air Perlis Sdn Bhd (SAP) for a yearly rental rate of 3% for current assets and 4% for new assets. The asset rate would also be revised every three years, added Muhyiddin.
With the deal sealed for Perlis, PAAB now have RM6.3 billion worth of water assets in its books.
Ahmad Faizal said PAAB was still in negotiations with the Selangor state and federal governments to acquire the Selangor water assets.
'We are still negotiating on the policy level, and if all works well, we should be able to conclude it by the end of the year,' he told The Edge Financial Daily.
Ahmad Faizal had previously said it hoped to acquire all water assets in the country by the end of the year. He has also indicated that the remaining water assets in Kelantan, Perak, Pahang and Selangor are worth between RM10 billion and RM15 billion.
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