New board members for K Euro soon

26/07/2007 The Star

KUALA LUMPUR: Kumpulan Europlus Bhd (K Euro), which is now controlled by Tan Sri Chan Ah Chye, will soon see new faces in its board after IJM Corp Bhd completes the purchase of 25% stake in the group.

Chan, the group’s chief executive, said K Euro’s board would consist of three representatives each from the two major shareholders – IJM and himself – plus three or four independent directors.

Chan, who is in the midst of paring down the huge borrowings in Talam Corp Bhd (associate company of K Euro), said going forward, K Euro would follow IJM’s management model.

He said the representatives from IJM would take care of K Euro’s financial matters.

IJM agreed to buy a 25% stake in K Euro at 25 sen per share. “The transaction should be done soon,” said Chan, but declined to comment if IJM intended to exercise its option to raise its stake to 30% in K Euro.

Besides taking a stake in K Euro, IJM has also formed joint ventures (JVs) with K Euro for several property projects.

Chan said the JV formed by K Euro and IJM was expected to bag RM3bil contracts for the development of the Canal City project in Shah Alam and construction of the West Coast Expressway (WCE).

Chan said the 50:50 JV had been awarded the RM2.5bil turnkey contract to design and build the WCE that linked the North-South Expressway in Taiping to Banting in Selangor.

“The construction of WCE is expected to start in the first quarter of next year,” he told reporters after the group’s AGM yesterday.

In addition, the Canal City project would generate about RM430mil contracts for Ambang Usaha Sdn – another JV between K Euro and IJM, he added.

Chan said K Euro’s performance would not be spectacular in the current financial year ending Jan 31, 2008 (FY08) “but would not incur losses”.

He noted that the contributions from the contracts secured would only materialise in FY09.

On the financing for WCE, Chan said Kumpulan LPB Sdn Bhd (KLPB), in which K Euro owns a 60% stake, had not finalised the fund-raising exercise for RM2.5bil to RM3bil.