UDA picks Pudu Jail main developer, to get final nod
Jun 02, 2011
UDA Holdings Bhd will submit the name of its preferred joint-venture partner for the Bukit Bintang City Centre (BBCC) development to the Finance Ministry by this week for final approval, chairman Nur Jazlan Mohamed said last night.
He declined to reveal the name of the company or the number of candidates considered but stressed that the board’s unanimous decision, made yesterday afternoon, was based on commercial considerations.
It was important that the BBCC project be implemented perfectly as this was likely UDA’s last chance to secure a steady source of income and avoid “severe negative consequences” that could threaten the company’s long-term future, Nur Jazlan said.
“There is no other piece of land that UDA can develop and deliver the kind of recurring income that we need,” he told The Malaysian Insider.
He said it was an “enormous strain” on UDA to be running down the assets inherited before the company’s listing in 1986 and pointed out that there have been no additions its 400-hectare land bank since then.
Nur Jazlan said it was crucial to get UDA past this crunch period or it would “run into trouble” and put the Bumiputera agenda in jeopardy.
“UDA itself is under threat so by keeping UDA alive, we can continue to help Bumis in the longer term,” he said.
But Nur Jazlan emphasised that Bumiputera interests would be protected in the BBCC as its development would not cost UDA or see the company relinquish ownership of prime land in the heart of Kuala Lumpur’s Golden Triangle.
He said UDA would receive all due assets before the joint-venture partner sold the balance to pay off its loan.
The joint-venture partner will also have to put up a bank guarantee to cover the cost of developing UDA’s share of assets, which make up 20 to 30 per cent of the RM3-4 billion development cost, he added.
Nur Jazlan said in a statement yesterday that UDA had no choice but be competitive to survive as it no longer received any direct assistance from the government.
“Most people don’t know that UDA Holdings no longer receives any form of special treatment from the government, whether in the form of grants or cash injections or sale of land at nominal prices,” he had said.
The corporatised government agency, whose assets are estimated to be worth RM2 billion, is over RM900 million in debt and has only about RM90 million in free cash flow now. – Malaysian Insider
