KUALA LUMPUR (June 5): Sime Darby Bhd, S P Setia Bhd, and the Employees Provident Fund (EPF) have formed a consortium to jointly bid for the redevelopment of the Battersea power station site in south London, according to officials close to the deal.
Sime Darby and S P Setia will each hold 40% equity in the consortium and the EPF will own the remaining 20%.
S P Setia and Sime confirmed to The Edge Financial Daily that both parties had jointly submitted a tender for the multi-billion property development in London. However, they declined to comment further on the details.
Sime Darby president and group CEO Datuk Mohd Bakke Salleh said in an email reply that the consortium is positive the mixed development proposal will be "well-received by the market".
"The partners will make all necessary announcements at the appropriate time," Bakke wrote in the email.
S P Setia president and CEO Tan Sri Liew Kee Sin also confirmed the property group's participation in the consortium. "However, we will have to decline any comments at this point in time. We will make all necessary announcements in due course," Liew said via email.
The EPF, which had earlier denied news reports that it was bidding for the Battersea land, declined to comment on the matter. "It is our policy not to comment on speculative stories," EPF public relations general manager Nik Affendi Jaafar said over the telephone.
Last week, Liew told the media at Invest Malaysia 2012 that S P Setia was "one of three remaining bidders" for the landmark power station.
In November last year, S P Setia submitted a RM1.3 billion offer to Lloyds Banking Group and Ireland's National Asset Management Agency to buy debt linked to the Battersea power station. However, the offer was rejected.
The asset is now under the administration of Ernst & Young.
Battersea power station is the largest brick building in Europe. The landmark power station has been vacant for almost three decades. The current bid for the redevelopment of the 15.8ha site in London is not the first attempt. However, the earlier attempts failed due partly to opposition from parts of the community.
S P Setia and Sime are considered sister companies, having Permodalan Nasiaonal Bhd (PNB) as the controlling shareholder. PNB holds a 66.5% stake in S P Setia and 47.4% of Sime Darby.
The EPF also holds a substantial 5.4% shareholding in S P Setia and 12.2% of Sime.
London has become one of the hotspots for many Malaysian property developers.
Sime Darby's 31.4%-owned associate Eastern & Oriental Bhd acquired an office and retail building in April known as "Princes House" in London for £20.25 million (RM99.55 million).
In February, Oriental Holdings Bhd bought the Kingsley Hotel in London for £42.71 million to grow its hospitality operations.
The Financial Times has reported that Malaysian players plan to undertake a £1.4 billion mixed development comprising houses, offices and shops at Battersea. Other bidders for the land include Chelsea Football Club owner Roman Abramovich who intends to construct a 60,000-seat stadium on the site.
According to Battersea Power Station Co Ltd's website, the registered charity hopes to create 4,000 jobs and preserve the historical elements of the landmark as the tract is being redeveloped.
This story appeared in The Edge Financial Daily on June 5, 2012.