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Reply to query |
Reply to Bursa Malaysia's
Query Letter - Reference ID |
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NM-080423-43310 |
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| REPLY TO QUERY: Concession Agreement with the People's Government of Changle County, Shandong Province, People's Republic of China for a New 38KM Raw Water Intake Project on Build-Operate-Transfer Basis |
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Further to the announcement of 21 April 2008 and the letter from Bursa Malaysia Securities Berhad dated 23 April 2008, Salcon Berhad wishes to provide further information in relation to the Concession Agreement ("CA") for the Implementation of a New 38KM Raw Water Intake Project ("Project") on Build-Operate-Transfer basis ("Concession") as follows:-
1. Basis of Payment to Salcon Shandong (HK) Limited ("SSHK"), Hong Kong
SSHK has been granted the rights to supply raw water to raw water purchasers within the Changle County and to collect payment therefrom based on
the approved tariff during the concession period of 30 years. The agreed rate is RMB0.65/m3.
SSHK also has the rights to request for rate adjustment after taking into account the actual volume of water supply, final construction costs, change of
government policies on water tariff and relevant inflation rate.
The rights, obligations, benefits and other terms and conditions of the CA and Concession will be novated to a new wholly-owned subsidiary of SSHK
("Newco") upon its incorporation.
2. Expected date of commencement and completion of construction of the Project
The construction works for the Project is expected to commence in June 2008, and to be completed in December 2009.
3. Expected date of commercial operation of the Project
The commercial operation of the Project is expected to commence in January 2010.
4. Source(s) of funding for the Project and the breakdown thereof
The subscription of the proposed registered capital of USD6.32 million (approximately RM19.85 million) in the Newco by SSHK will be funded by the
Company through internally generated funds and bank borrowing. The Newco will be a wholly-owned subsidiary of SSHK.
The Newco will fund the Project through the proposed registered capital and bank borrowing at the following proportion:-
Proposed Registered Capital : 40%
Bank Borrowing : 60%
5. The Concession is not renewable.
This announcement is dated 24 April 2008.
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We refer to your announcement dated 21 April 2008 in respect of the above
captioned matter.
In this connection, kindly furnish Bursa Securities with the following
additional information for public release :-
1. The value of the Concession or how the payment to Salcon Shandong (HK)
Limited will be arrived at.
2. Expected date of commencement and completion of construction of the Project.
3. Expected date of commercial operation of the Project.
4. Source(s) of funding for the Project, and the breakdown thereof.
5. Whether the Concession is renewable. If so, for how many years.
Kindly furnish Bursa Securities with your reply within one (1) market day from
the date hereof.
Yours faithfully
TAN YEW ENG
Head, Issuers
Listing Division, Group Regulations
MZM/NMA
c.c:- Head, Market Surveillance Department, Market Supervision Division,
Securities Commission (via fax) |
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