Gamuda: Highway takeover talks will be based on market valuation

Gamuda Bhd said it will ensure the government's bid to take over its highway concessions will be based on market valuation norms and practices.

"As the board of directors of Gamuda have a fiduciary duty to deliver fair and reasonable value to all its shareholders, Gamuda has to ensure that the proposed transaction will be based on market valuation norms and practices," the highway construction firm said in an announcement to Bursa Malaysia yesterday.

The announcement, which has been confirmed by the company, was in response to a statement issued by the Prime Minister's Office (PMO).

Last Saturday, the PMO announced that the government has entered into talks to acquire four highways from Gamuda Bhd.

The highways are the Damansara-Puchong Expressway (LDP), Western KL Traffic Dispersal System (Sprint Expressway), Shah Alam Expressway (Kesas) and the Smart Tunnel.

The PMO said upon successful acquisition, the government plans to abolish tolls and impose a congestion charge which would be up to 30 percent lower than current tolls.

It added that there would be no charges during off-peak hours between 11pm and 5am.

Following the PMO's statement, Gamuda's share closed at RM2.86 yesterday from RM3.04, a decline of 5.92 percent.

However, the shares recovered slightly today and, as of 12.50pm, is up 2.8 percent to RM2.94 a share.