KUCHING: The State Financial Secretary (SFS) Inc will become the single largest shareholder of Bintulu Port Holdings Bhd (BPHB) with nearly a 40% stake after taking up 60 million new ordinary shares of RM1 each under BPHB’s proposed placement exercise.

SFS or its nominated wholly-owned subsidiary will pay RM399mil or RM6.65 each for the new shares, which represents 15% of BPHB’s issued and paid-up capital of RM400mil.

A conditional subscription agreement for the proposed placement was signed between SFS, the investment arm of the Sarawak government, and Kenanga Investment Bank Bhd (KIBB) — the placement agent for the new shares — last week.

The proposed subscription is subject to, among other conditions, approval by the Securities Commission to exempt SFS and its nominated company and persons acting in concert from the obligation to undertake a mandatory offer for all the remaining BPHB shares not already owned by them after completion of the placement expected in second quarter of this year.

BPHB will seek the approval of its non-interested shareholders on the proposed exemption at an extraordinary general meeting to be convened later.

Upon subscribing the new shares, SFS’ shares in BPHB will balloon to 182,701,000 units or 39.72% from the current 30.68%.

SFS will overtake Petronas, which currently owns 32.79% stake, as BPHB’s single largest shareholder.

Apart from the proposed share placement, BPHB plans to raise RM950mil from the issuance of Islamic securities or sukuk to fund the proposed development of the Samalaju Port to serve the industries in Sarawak Corridor of Renewable Energy (SCORE).

The issuance of sukuk is expected to be completed by June.

BPHB group will operate the Samalaju Port through wholly-owned subsidiary, Samalaju Industrial Port Sdn Bhd (SIPSB), pursuant to a principal agreement between Samalaju Port Authority and SIPSB for an expected duration of 40 years.

BPHB will utilise the net proceeds of RM397.6mil (minus estimated expenses of RM1.4mil) from the share placement within six months.

“The cost of the proposed (Samalaju Port) development is approximately RM2.2bil (inclusive of finance charges incurred during construction) which is envisaged to be funded by a combination of the issuance of Islamic securities by SIPSB, new equity issuance, internally generated funds of BPHB and government grant(s),” said BPHB.

The proposed Samalaju Port is designed to handle 18 million tonnes of cargo per year as compared to Bintulu Port’s current capacity of 16 million tonnes (of non-liquefied natural gas cargo) per year. The new port’s capacity can be raised to 30 million tonnes a year if necessary.

The construction of Samalaju Port’s interim port facilities to cater for barges is currently under way. The barges will be used to transport especially construction and building materials as well as machinery for factories to be built in Samalaju Industrial Park.

Two weeks ago, BPHB awarded a RM437mil contract for the new port’s capital dredging and reclamation package (for Phase I works) to Integrated Marine Works Sdn Bhd.

Under the package, a 5km access channel to deeper waters from the proposed Samalaju Port would be dredged to a depth of 15m. Also to be dredged to 14m would be the lower harbour basin.

The new port’s breakwater package, according to BPHB chief executive officer Datuk Mior Ahmad Baiti Mior Lub Ahmad, was expected to be awarded this month.

Contract for the proposed wharf package is scheduled to be dished out next month or May while the final package — land site infrastructure development — would likely be awarded in the middle of this year.

The final package will include the construction of the port’s administrative building, storage yards and other related facilities as well as the mechanical and electrical works.

Mior Ahmad expects full completion of the Samalaju Port in second quarter of 2016.

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