According to the announcement posted on its website, the government-owned Prasarana said the tenders were for the manufacture, supply, delivery, maintenance of 400 units of 12-metre completely-knocked-down diesel city buses for RapidKL.

The tender documents went on sale from Oct 21. The closing date for the tenders is noon on Nov 23. It invited bus chassis manufacturers, registered in Malaysia, to take part in the tenders.

Prasarana was set up as part of the government’s initiative to restructure the public transport system. It owns and operates Klang Valley’s light-rail-transit (LRT) systems, the bus fleet servicing the Klang Valley and Penang, and the Kuala Lumpur monorail system.

The LRT systems were previously owned by Sistem Transit Aliran Ringan Sdn Bhd (STAR) and Projek Usahasama Transit Ringan Automatik Sdn Bhd (PUTRA). The assets of the KL monorail were acquired from KL Monorail System Sdn Bhd in December 2007. Prasarana is the operator of the KL Monorail system.

On Oct 19, a report by the auditor-general (AG) expressed concerns Prasarana was is in danger of not meeting its remaining bond commitments of RM7.1 billion if it failed to rectify its cash flow position.

According to the National Audit Report: Ministries & Government-owned Companies, the government must take drastic action to ensure it does not need to bail out the public transportation company.

The A-G said the Finance Ministry needed to monitor Prasarana’s financial management to ensure that it was handled more efficiently to improve its cash flow. This is crucial to avoid the government being made to repay Prasarana’s bonds amounting to RM7.1 billion (principal) when they mature between 2011 and 2023.

This article appeared in The Edge Financial Daily, October 28, 2009.