MRCB, George Kent fall after Putrajaya urged to reconsider LRT3's PDP appointment

KUALA LUMPUR (Sept 14): Shares of Malaysian Resources Corporation (MRCB) and George Kent (M) Bhd fell today, after Putrajaya was urged to reconsider the appointment of the two companies as the project delivery partner (PDP) for Light Rail Transit 3 (LRT3) project.

At 12.19 pm, MRCB was traded at RM1.03, down 1 sen or 0.96%, with 1.82 million shares done, giving it a market capitalisation of RM1.84 billion.

George Kent was traded 3 sen or 2.1% lower at RM1.40, with 736,000 shares having changed hands, for a market capitalisation of RM420.57 million.  

The Malaysian Insider (TMI) reported today that Putrajaya has been urged to reconsider its decision to appoint MRCB and George Kent (M) Bhd as its project delivery partner for the Light Rail Transit 3 (LRT3) from Bandar Utama to Klang.

Quoting a source in the industry, TMI reported that although Prasarana Malaysia Bhd had announced the appointments of MRCB and George Kent at a press conference on Sept 4, there were many unanswered questions as the consortium had tendered a higher price than the cost of RM9 billion determined by Prasarana.

According to documents sighted by TMI, George Kent's tender had offered the price of RM11.5 billion, the third lowest of six tenders submitted, for the project.

The UEM consortium, meanwhile, had submitted a tender for RM9.88 billion, while the lowest bid was for RM9.5 billion.

A source close to the selection process for the LRT3 project also said the announcement appointing MRCB-George Kent “had shocked the industry”, as George Kent was known to have problems in the construction of the Ampang Line LRT extension, which was completed a year later than scheduled.

The source also told TMI that MRCB's appointment as George Kent's partner to form a consortium to bid for the LRT project is “strange”, as MRCB was better known as a developer in the commercial sector and not in the transport industry.