KUALA LUMPUR (Feb 19): Bina Puri Holdings Bhd (KL:BPURI) said it is disposing of its 50% stake in the concessionaire of the KL-Kuala Lumpur Selangor Expressway (Latar) to Latar managing director Datuk Mohamed Raffe Chekku for RM77 million.

The construction group said it signed the deal with Mohamed Raffe’s company, Arena Irama Sdn Bhd, which owns the remaining 50% stake in Kuala Lumpur–Kuala Selangor Expressway Bhd (KLKSE). KLKSE holds the Latar concession till 2048.

The move to exit the concession comes as no dividends have been paid out by KLKSE in the nearly three decades since the concession project was awarded in 1997, Bina Puri said in a bourse filing on Thursday.

“Hence, the proposed disposal represents a timely opportunity for the group to realise its entire investment value in KLKSE, which will enable the group to achieve an estimated gain on disposal of approximately RM74.9 million,” said Bina Puri executive director and group CEO Marcus Goh Kee Lun.

Bina Puri said it will use the proceeds of the sale to repay bank borrowings to improve its financial position. Gearing ratio is expected to be reduced to 0.81 times from 1.8 times.

Goh added that the group aims to complete its proposed scheme of arrangement by the first quarter of 2026.

As at end-December 2024, KLKSE had accumulated losses of RM234.2 million, with assets of RM1 billion and total liabilities of RM1.18 billion.

The RM77 million price-tag falls within the lower end of the market value range of between RM76.3 million and RM110.9 million, as ascribed by Deloitte Malaysia, Bina Puri said.

The valuation was derived from a discounted cash flow approach of KLKSE, by discounting the estimated weighted average cost of capital of approximately 8% to 9% for the period from Jan 1, 2026, to Oct 27, 2048, the group said.

The deal, subject to shareholders’ approval, is expected to be completed by the second quarter of 2026. It is also subject to consent from KLKSE’s existing financiers and the government.

Shares of Bina Puri ended unchanged at 30 sen, valuing the group at RM267.89 million.