KUALA LUMPUR (Sept 1): Seni Jaya Corp Bhd (KL:SJC) has secured a seven-year concession to manage and commercialise advertising spaces at the Johor Bahru-Singapore Rapid Transit System (RTS Link).

The concession was awarded to SJX Media Sdn Bhd, an indirect 70%-owned subsidiary of Seni Jaya, by Malaysia Rapid Transit System Sdn Bhd (MRTS) — a wholly owned unit of Malaysia Rapid Transit Corp Sdn Bhd (MRT Corp) — under an advertising concession agreement dated Sept 1.

In a Bursa Malaysia filing on Tuesday, Seni Jaya said that SJX Media will design, install, operate, maintain and eventually transfer the advertising media at designated spaces within the RTS Link project. It will also market, sell and manage the advertising spaces throughout the concession period, at its own cost and risk.

As of end-June, Seni Jaya had RM5.7 million in cash and cash equivalents, against RM24.4 million in total borrowings. 

Seni Jaya said SJX Media must complete the pre-operational works within three months of the agreement’s effective date, covering the procurement, fabrication, installation, testing and commissioning of the advertising infrastructure. It will also bear the costs of the performance bond, security deposit, service charges, utilities and insurance.

SJX Media must provide a performance bond equivalent to 10% of the total minimum annual guarantee. 

Once the concession begins, SJX Media will pay MRTS a minimum annual guarantee and a portion of its advertising revenue.

Seni Jaya said the concession may be renewed for another three years at MRTS’ discretion, subject to revised terms for the minimum annual guarantee and revenue-sharing percentage.

It said the concession is expected to contribute positively to the group’s future earnings, earnings per share, net assets per share and gearing.

Shares of Seni Jaya were last traded at 50 sen on Tuesday, giving the out-of-home media advertising specialist a market capitalisation of RM208.17 million.