KUALA LUMPUR (Oct 20): Following the completion of the disposal of its entire 50% equity interest stake to Malaysian Resources Corporation Bhd (MRCB) last Wednesday (Oct 13), George Kent (Malaysia) Bhd said it is looking forward to exploring new growth opportunities.
It has disposed of 50% equity interest in MRCB George Kent Sdn Bhd (MRCBGK) to MRCB for RM53 million cash.
MRCBGK, a joint venture company between MRCB and George Kent, is a special purpose vehicle incorporated on Sept 17, 2015 to execute the Light Rail Transit Line 3 (LRT3) project which has a finite life for completion by end of 2024. Currently, approximately 60% of the works have been completed.
Following the disposal, George Kent said it will focus on developing new opportunities in the domestic and regional railway space under the 12th Malaysia Plan’s (12MP) policy enabler of enhancing connectivity and transport infrastructure.
“This allows George Kent to leverage on its expertise as a rail systems specialist in railway projects.
“George Kent’s track record of successful execution and timely delivery of the Light Rail Transit Ampang Line Extension (LRT2) project coupled with the experience gained from the LRT3 project augurs well for the group to expand its role in the rail network infrastructure,” said the group in a statement to Bursa Malaysia on Wednesday.
It said the disposal provided an opportunity for the group to monetise its investment in MRCBGK, which has zero cost of investment.
The group had already recovered its original cost of investment in December 2017 upon receipt of a cash dividend of RM5 million declared by MRCBGK, according to George Kent.
In addition, George Kent also had benefitted from equity gains of RM57.2 million as at June 30, 2021, which were credited to the group’s retained earnings.
Commenting on the disposal, George Kent chairman Tan Sri Tan Kay Hock said George Kent is proud that it had provided the expertise by seconding, initially, senior staff for the systems works for the LRT3 project to MRCBGK.
On top of the railway space, Tan said the group is also in a good position to strengthen its thriving water meter business by exploring opportunities in the water infrastructure projects in view of the acceleration of the adoption of integrated water resources management by the government under the 12MP.
“As digital technologies are rapidly reshaping industries, the group is also looking to create a platform for strategic investments into companies with digital technology such as IoT [Internet of Things] and AI [artificial intelligence] that will serve as an extension of our smart metering development, in the areas of urban solutions and sustainability as well as emerging technology.
"The platform will provide the group with access to new areas of growth opportunities. We believe exciting times are ahead for George Kent,” he added.
At Wednesday's noon break, George Kent fell half a sen or 0.71% at 70 sen, translating into a market capitalisation of RM391.47 million.
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