Wednesday February 6, 2013
Gabungan AQRS in concrete tie-up with Sedco
By TEE LIN SAY
PETALING JAYA: Gabungan AQRS Bhd is tying up with the Sabah Economic Development Corp (Sedco) through the subscription of a 49% stake or 2.94 million shares in the latter's subsidiary, Associated Concrete Products (Sabah) Sdn Bhd (ACPS), for some RM3.5mil, said sources.
ACPS is understood to be involved in the manufacturing and dealing of precast concrete products. Sedco holds the remaining 3.06 million shares or 51% of the company.
Sources said that this development was not surprising, as the company had articulated its vision to identify strategic partners in the precast concrete segment to enable its expansion in the construction sector of Sabah and Sarawak.
During its listing exercise in July last year, management mentioned that it wanted to increase participation in public private partnership (PPP) initiatives and increase revenue base from its property development business.
Gabungan AQRS is an integrated engineering and construction services provider, specialising in industrialised building solutions, undertaking building and civil engineering works.
“Gabungan has plans to explore construction and property development opportunities in Sabah and Sarawak and in Indonesia. They are looking to enter into joint ventures with local contractors and focus on projects financed by established organisations,” said the source.
At present, Gabungan AQRS has a construction orderbook of RM1.2bil and a property development orderbook of RM1.44bil that will last it until 2015.
An analyst who had covered the stock during its listing exercise said Gabungan AQRS was actively looking at PPP initiatives, which typically involve a build, lease and transfer operating mode.
“Should such endeavours materialise, Gabungan would be embarking on its maiden venture as a concessionaire, in which the company will build the physical structure and lease it to third parties.
“The internal rate of return for such projects is typically in the mid-teens and we expect more news on this front come the first half of 2013,” said the analyst.
In September, Gabungan AQRS clinched a sub-contract job from Syarikat Muhibbah Perniagaan dan Pembinaan Sdn Bhd for the construction works for the Klang Valley Mass Rapid Transit (KVMRT) worth RM303.5mil.
The scope of works entails the construction and completion of the viaduct guideway and other associated works for the KVMRT line from Sg Buloh to Kota Damansara.
In December, Gabungan AQRS's wholly owned unit, Gabungan Strategik Sdn Bhd, secured an RM36.49mil contract for the main building works of a factory construction project in Shah Alam, Selangor.
For the third quarter to Sept 30, 2012, it posted a net profit of RM3.94mil on the back of RM110.47mil in revenue. For the cumulative nine-month period, it recorded a net profit of RM18.62mil on RM254.28mil in revenue.
The company was listed on July 30 at an initial public offering price of RM1.18.