KUALA LUMPUR (April 20): Citaglobal Bhd and Reneuco Bhd, which have won a tender to develop an independent power producer (IPP) project for the East Coast Rail Link (ECRL) network, on Thursday (April 20) signed an agreement to formalise their collaboration via a new special purpose vehicle (SPV).

Citaglobal will contribute 60% and Reneuco 40% of the RM500,000 initial share capital of the SPV, said the two groups in separate bourse filings.

They said Citaglobal will lead the negotiations with Malaysia Rail Link Sdn Bhd (MRL) to finalise the terms and conditions for the IPP project.

MRL — an entity of the Ministry of Finance (Incorporated) or MOF  Inc — is developing the ECRL project and will operate it in a 50:50 joint venture with China Communications Construction Company.

Citaglobal (formerly known as WZ Satu Bhd) and Reneuco (formerly known as KPower Bhd) had won the tender to develop the IPP project for the ECRL network in December last year.

The SPV, called Citaglobal Reneuco ECRL Energy Solution Sdn Bhd, will undertake the financing, construction  and operation of the project

The proposal submitted by the SPV involves the supply of renewable power to commercial or industrial parks along the ECRL's 640km alignment.

Share price of Citaglobal closed 3 sen or 2.10% higher at RM1.46, valuing the group at RM554.17 million.

Reneuco finished unchanged at 23 sen, giving it a market capitalisation of  RM131.64 million.