KUALA LUMPUR (Sept 21):  The Employees Provident Fund (EPF) is acquiring a 40% stake in the concessionaire of the Duta-Ulu Klang Expressway (DUKE) for RM1.13 billion, from Ekovest Bhd.

Ekovest, in a filing to Bursa Malaysia, said its wholly-owned subsidiary, Nuzen Corporation Sdn Bhd, has entered into a binding term sheet with EPF to dispose of the stake in Konsortium Lebuhraya Utara-Timur (KL) Sdn Bhd (Kesturi).

It said upon completion of the disposal, EPF will pay RM921 million in cash, as part payment of the consideration to Nuzen. Another RM60 million will be paid upon the certificate of practical completion for DUKE Phase 2 being issued.

A further sum of RM149 million in cash will be paid by EPF to Nuzen, subject to Nuzen’s fulfilment of the post-completion conditions, as stipulated in an agreement between both parties.

The disposal is conditional upon the approval of Ekovest’s shareholders, consent from the government under the relevant concession agreement entered into by Kesturi, consent from the holders of the existing senior sukuk issued by Kesturi, and EPF being satisfied with the outcome of a due diligence exercise to be carried out on Kesturi.

Ekovest had bought a 70% stake in Kesturi in 2012 in a RM325 million share-swap deal. In 2014, Ekovest bought the remaining 30% interest in the DUKE concessionaire from Malaysian Resources Corp Bhd (MRCB) for RM230 million.

Ekovest shares, which were suspended from trading today pending the release of this announcement, have risen 15.2% so far this month. They are trading at a five-year high of RM1.97, with a trailing P/E of 10.77 times and a market capitalisation of RM1.69 billion.