Let experts decide on PLUS bids, not politicians
P Gunasegaram | 01 Nov 2019 00:30

A newly revised offer for PLUS Malaysia Bhd, effectively RM38.3 bil including debt, has put a different spin on the proposed takeovers and high- lighted that earlier offers may have been grossly undervalued. That is not to say that the new offers are fair – not yet.

There is simply not enough public information to indicate that the offers are strictly comparable. In valuing a toll concession that won’t expire until 2038, or 18 years from now, even a small difference in details can translate into a massive difference in terms of the total value.

It becomes more complex when some of the offerers are asking for more than what is already on the table. There are some who still want government guarantees on the loan to continue, without any doubt whatsoever a direct government subsidy as it underwrites risk while forgoing profit.

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