KUALA LUMPUR (April 28): Anih Bhd inked a supplemental concession agreement (SCA) with the government in November last year to extend its toll concession on the Kuala Lumpur-Karak Highway (KL-Karak) and Phase 1 of East Coast Expressway (ECE1) to 2069, according to MARC Ratings Bhd.
The rating agency, which on Nov 8, 2022 affirmed its AAIS rating and stable outlook on Anih’s RM2.5 billion senior sukuk musharakah programme, said no material development has taken place since the execution of the SCA on Nov 17.
However, MARC Ratings said it understands that Anih has scheduled a sukukholders’ meeting on May 9, 2023, in relation to the SCA. It added that Anih currently has an outstanding RM1.48 billion sukuk under the existing RM2.5 billion sukuk programme
This confirms a report in the March 20-26 edition of The Edge Malaysia that a concession extension had been shored up between Anih and the government just prior to the 15th general election on Nov 18. Anih’s initial 28-year concession on KL-Karak and ECE1 was previously slated to expire in 2032.
Also substantiated was the over RM2 billion lane widening and flood mitigation works attached to the agreement, as the rating agency also said the 37-year extension also entailed lane widening and flood mitigation works with construction costs of RM2.3 billion.
“MARC Ratings highlights that under the SCA a new toll structure will be implemented in 2027 subject to completion of works related to the lane widening and flood mitigation; in the interim, no toll compensation from 2022 onwards would be provided.
“Under this circumstance, the rating agency has forecast that the finance service coverage ratio in 2023 would decrease to around 1.8 times from 1.9 times but remain above the covenanted 1.75 times, and accordingly there would be no immediate impact on the rating,” the agency said.
MARC Ratings added that it expects Anih to, in the near term, put in place a new financing structure that would also address the current outstanding RM1.48 billion sukuk.
“The rating agency will continue to monitor developments in Anih and provide updates as appropriate,” it added.
Anih is 51% owned by the estate of the late Tan Sri Dr Nik Hussain Abdul Rahman, while the remaining 49% is owned by Tan Sri Azmil Khalili Khalid, who is married to Nik Hussain's eldest daughter, Nik Fuziah Nik Hussain.
Anih obtained the ECE1 and KL-Karak toll concessions in 2011 after it acquired the entire business and undertakings of Metramac Corp Sdn Bhd and MTD Prime Sdn Bhd for RM3.25 billion.
Nik Hussain and Azmil set up Anih as a special vehicle for the acquisition. They were major shareholders of MTD Capital Bhd, the ultimate holding company of Metramac Corp and MTD Prime, prior to 2011. MTD Capital, which was listed on Bursa Malaysia in 1994, was delisted and taken private in May the same year.
Anih funded the acquisition through the RM2.5 billion senior sukuk programme and RM620 million in unrated junior bonds.