KUALA LUMPUR (Feb 17): Zelan Bhd's wholly owned subsidiary Zelan Construction Sdn Bhd (ZCSB) has bagged a RM307.37 million contract from Zelan's 95%-owned unit Terminal Bersepadu Gombak Sdn Bhd to be the main contractor for the development of the Gombak Integrated Transport Terminal (GITT) in Selangor.

In a filing with Bursa Malaysia today, Zelan said a tripartite agreement was signed among ZCSB, Terminal Bersepadu Gombak and Landasan Kapital (M) Sdn Bhd (LKSB) for the proposed project.

On Dec 30, 2015, Zelan had signed a share sale agreement (SSA) with LKSB to sell its 950,000 shares, representing a 95% stake in Terminal Bersepadu Gombak, to LKSB for RM1 million.

The SSA is conditional upon the respective parties having secured the financing in respect of the GITT project and approvals from its board of directors and its shareholders, if necessary, on the sale and purchase transaction.

Upon completion of the SSA, Zelan or its nominee is granted the right of first refusal to carry out the construction works for the GITT, as well as the Middle Ring Road 2 (MRR2) upgrading works here.

Meanwhile, Zelan announced that Terminal Bersepadu Gombak has agreed to appoint LKSB to be the main contractor for the MRR2 works.

"LKSB (also) agrees to appoint ZCSB to carry out subcontract works related to the MRR2 works on such terms and conditions to be agreed upon between LKSB and ZCSB," it added.

According to a concession agreement dated March 15, 2012 entered into between the government and Terminal Bersepadu Gombak, the upgrading works on MRR2 shall be awarded by the government to the company in accordance with the terms and conditions of the design and build contract to be entered into.

Zelan said the two contracts are expected to contribute positively to its earnings for the current financial year ending Dec 31, 2016 (FY16).

Zelan shares closed half a sen or 2.17% higher at 23.5 sen today, with a market capitalisation of RM194.33 million.