KUALA LUMPUR (THE STAR/ASIA NEWS NETWORK) - The Cabinet has decided not to sell national highway operator Plus to any private companies as their bids are not attractive enough, says Prime Minister Mahathir Mohamed.
"We have studied all the bids made by the private sector, and also the bid by Khazanah Nasional," said Tun Dr Mahathir, referring to Malaysia's sovereign wealth fund.
"We decided that the best way is not to sell Plus to anybody, but to keep it with Khazanah Nasional and Employees Provident Fund (EPF)."
Dr Mahathir also said Plus would be given a 20-year extension of the toll concession.
"People need not worry about the 20-year extension of the toll concession on Plus as the reduced flat rate, when compared against future ringgit rates, will be minimal," he explained.
"They (Plus) have to reduce the toll rate by 18 per cent, but remember, 18 per cent is set at today's rate. That means, in 20 years' time, the 18 per cent when compared with the ringgit rate then will not be very high.
"Traffic will increase, but the value and purchasing power of the ringgit will go down, so what they (Plus) earn afterwards (in 20 years) is not as big as people think they are going to get."
"This is because we are looking at it at the present rate, and it will be a flat rate minus 18 per cent," Dr Mahathir told the media after officiating the opening of the Balai Islam Complex at the Tenaga Nasional Bhd headquarters in conjunction with its 70th year.
Plus is the largest highway concessionaire in Malaysia and operates the North-South Expressway.
Currently, Plus is controlled by the UEM Group - a subsidiary of Khazanah Nasional - and the EPF. Khazanah holds 51 per cent stake in Plus, with the remaining 49 per cent held by the EPF.
Khazanah had proposed that the best entity to take over Plus was, in fact, the government.
It was reported that four other players vying for Plus had offered cash for the equity stakes of both Khazanah and the EPF, but the more pressing issues were Plus' debts.