KUALA LUMPUR: MRCB-George Kent Sdn Bhd has received the letter of appointment for the construction of the Light Rail Transit Line 3 from Bandar Utama to Johan Setia following the revision of its price tag.
According to separate filings by Malaysian Resources Corp Bhd (MRCB) and George Kent Bhd, the contract sum is fixed at RM11.86bil and includes a contingency/provisional sum of RM400mil, which, if not utilised, will reduce the contract sum.
“The Date of Completion under Contract shall be 28 February 2024, unless extended in accordance with the Contract,” said the filings.
Among the terms of the contract, MRCB and George Kent are to provide a proportionate corporate guarantee to Prasarana Malaysia Bhd and negotiations on the fixed price contract shall continue so that the contract will be executed no later than Dec 12, 2018.
Both companies said the contract will not have any significant effect on their respective earnings and net assets for their current financial year, but it is expected to contribute positive to their future earnings.
“The Project is subject to normal business risks such as an increase in costs due to any escalation of material costs and contractual terms including default provisions. As such, the Management will put in place control measures and operational procedures to reduce the impact or likelihood of such events.”