November 17, 2007 (The Star) – Sime Darby Bhd says Synergy Drive Bhd has obtained the Government’s approval to acquire a 60% stake in Sarawak Hidro Sdn Bhd, owner of the 2,400-megawatt Bakun dam project.
“Synergy Drive will proceed to commence negotiations with the Government of Malaysia on the terms of the acquisition,” the company said in a statement to Bursa Malaysia yesterday.
Trading in the shares in Sime Darby, the main contractor for the RM6bil hydro-electric dam project, is currently suspended to facilitate the listing of Synergy Drive on Nov 30.
Sime Darby, Golden Hope Plantations Bhd, Kumpulan Guthrie Bhd and their subsidiaries have agreed to combine their businesses under Synergy Drive to create a conglomerate that is estimated to have a market value of more than RM60bil.
It would be the biggest company listed on Bursa Malaysia, with five core operations: plantations, property, heavy equipment, motor and power and utilities.
“With the letter of intent (LOI), we can start work with all our vendors,” Synergy Drive chief executive Datuk Seri Ahmad Zubir Murshid said at a press briefing yesterday.
He said Synergy Drive, with its healthy balance sheet post-listing, would have the financial muscle to undertake such massive projects.
It was reported earlier that Sime Darby had expressed its intention to the Government to take up a key interest in Sarawak Hidro. It also wanted to play a leading role in the proposed undersea power cable project.
Analysts said the power and utilities business could emerge as a major contributor to Synergy Drive if it managed to secure both projects.
The 700km submarine cable is said to cost RM9bil. The project is likely to be undertaken by a consortium that may include Tenaga Nasional Bhd.
The Government, however, has yet to formally decide on the project.
Zubir said Synergy Drive hoped to bring electricity generated from Bakun to the peninsula beginning 2013, assuming the Government accepted its proposal.
Construction works on the Bakun dam were expected to be completed by 2009, Zubir said, with equipment testing and other works expected to take another year.
Sarawak Hidro was set up by the Finance Ministry to take over the Bakun dam project after it was temporarily shelved in 1997 due to the Asian economic crisis. The mega project was revived in 2000.