Gagasan Nadi Cergas group managing director Datuk Seri Wan Azman Wan Kamal
KUALA LUMPUR: Gagasan Nadi Cergas Bhd
has entered into a deal to acquire Konsortium PAE Sepakat Sdn Bhd (KPSSB), which owns a facility management concession for student hostel facilities, for RM185mil
KPSSB entered into concession agreements with the government of Malaysia in 2013 to develop and maintain student hostels at campuses in Banting, Ipoh, Port Dickson, Johor Bahru, Seberang Prai, Jeli, and Kota Bahru until 2036.
Each polytechnic campus is served by a special purpose vehicle (SPV) company fully owned by KPSSB.
The group said in a stock exchange filing it will purchase the entire equity in Serata Ehsan Sdn Bhd, which via its fully owned subsidiary PAE Builders Sdn Bhd, holds 44.44% of KPSSB for a consideration of RM80mil.
Meanwhile, it will pay a sum of RM105mil for the entire equity in Seri Delima Anggun Sdn Bhd, which holds the remaining 55.56% stake in KPSSB.
Gagasan Nadi Cergas said it will fund the purchases via fundraising from the debt capital markets, bank borrowings and internally generated funds.
The group said the proposed acquisitions will allow it to indirectly own the polytechnic SPVs, which will complement its current concessions to construct and provide asset management services to student hotels at two public universities.
“Our concession and facility management operations remain a key strength for Gagasan Nadi Cergas, delivering a steady, stable stream of recurring income.
"The acquisition of KPSSB will enlarge the group’s revenue and earnings base for the segment through sustainable income and cash flows generated from the concessions under KPSSB," said Gagasan Nadi Cergas group managing director Datuk Seri Wan Azman Wan Kamal in a statement.
