Penang CM defends rejection of IJM-Aspen bid by releasing part of tender documents

KUALA LUMPUR (May 28): Penang Chief Minister Chow Kon Yeow (pictured) released parts of the request for proposal (RFP) and tender documents for the Ladang Byram/Changkat project under Batu Kawan Industrial Park (BKIP) 2 to defend the state’s rejection of the IJM Properties-led consortium bid.

The consortium also included Aspen Vision All Sdn Bhd, a subsidiary of Aspen Group Holdings Ltd, and Mettiz Capital Sdn Bhd.

In an eight-page statement, Chow cited excerpts from the tender submission and RFP rules to support the Penang Development Corporation’s (PDC) view that the bid did not meet key requirements and offered less favourable terms.

He also denied claims that the developer would bear land conversion and premium costs.

Chow was responding to statements made by Aspen Group and former Penang chief minister and Bagan member of parliament Lim Guan Eng between May 22 and May 24, 2026.

He said the bidder’s proposal included unfavourable changes and conditions that required PDC to fulfil certain requirements, when the RFP clearly states that any conditional offer that changes the original terms will not be accepted.

Chow said from the perspective of tender evaluation, PDC interprets at least two key matters as offers that are worse off than the original RFP terms and not beneficial to PDC, which PDC has the right not to consider.

These include providing infrastructure (electricity, water, and telecommunications) from Bandar Cassia Highway to the BKIP boundary, and the land ownership status.

Chow said the consortium had proposed that PDC ensure electricity, water and telecommunications infrastructure connections were provided from Lebuhraya Bandar Cassia up to the BKIP boundary.

He said the requirement contradicted the RFP conditions, which clearly stipulated that all infrastructure upgrading and utility works were to be borne by the developer.

“The connection of infrastructure up to the BKIP development boundary would involve expenditure of approximately RM150 million, which would have to be borne by PDC,” he said.

Chow added that the consortium had also proposed that the land be granted on a freehold basis, with PDC bearing the alienation costs and without requiring the developer to pay rezoning or conversion premiums.

“PDC interprets that the premium payment cost for the freehold application would need to be borne by PDC, with the estimated cost amounting to RM144 million,” he said.

Chow also rejected claims that the developer would bear those premium costs.

“The allegation that the alienation or premium costs would be borne by the developer is untrue, because there is no statement in the tender submitted by the bidder that such costs would be borne by the bidder,” he said.

“Based on these two offer conditions alone, the estimated cost to be borne by PDC could already reach approximately RM294 million,” Chow added. “As such, the net returns received by PDC cannot be viewed solely based on the bidder’s gross offer price of RM818 million.”

Chow maintained that the decision to reject the proposal was consistent with PDC’s governance procedures and tender evaluation framework.

The RFP conditions state that PDC retained the “absolute right” to reject any proposal regardless of whether it offered the highest profit-sharing amount.

The Ladang Byram/Changkat land deal has been politically contentious since 2023, when the state government terminated an earlier direct-negotiation proposal involving Umech Land Sdn Bhd, a company later revealed to be majority-owned by Sunway Bhd (KL:SUNWAY), following public criticism over the lack of an open tender and concerns that the land was being sold below market value.

The issue recently escalated into a heated political dispute in the Penang state assembly involving Chow and his predecessor Lim Guan Eng, when he questioned PDC’s decision to reject IJM-Aspen’s RM818 million bid.

Earlier this month, Chow also disclosed that the consortium’s bid failed to comply with five out of nine key conditions in the 2024 RFP, including conditions relating to development obligations, land ownership structure, land transfer mechanisms and guaranteed profit-sharing payments.

He subsequently said PDC had also decided not to proceed with a later 2025 RFP exercise involving the Kwest Sdn Bhd-Kerjaya Prospek Group Bhd (KL:KERJAYA) consortium due to non-compliance with several key tender conditions and additional demands made by the bidder.

PDC has since decided to initiate a fresh tender process for the site.

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