In honouring its end of the water restructuring deal with the Selangor government, the federal government will exercise its powers to coerce Selangor water concessionaires to accept the RM9.65 billion acquisition offer by the state.
The Energy, Green Technology and Water Ministry said it will exercise its rights under the Water Services Industry Act 2006 (WSIA).
This comes after three of four water concessionaires rejected the offer.
“In line with the terms of the MOU, the federal government through the Ministry of Energy, Green Technology and Water shall now pursue the exercise of its rights and powers under the WSIA as well as any other relevant acts, statutes or regulations to assist the state government in implementing the proposed restructuring and consolidation of the Selangor water supply industry.
“This includes invoking Section 114 of WSIA in order to address issues of national interest to ensure security, sustainability and viability of the water supply industry in Selangor, Kuala Lumpur and Putrajaya,” read a joint statement issued by the ministry and Menteri Besar’s Office today.
The move was agreed upon following a meeting between minister Dr Maximus Johnity Ongkili (above) and Menteri Besar Abdul Khalid Ibrahim today.
Yesterday, concessionaires Puncak Niaga Sdn Bhd, Syarikat Bekalan Air Selangor (Syabas) and Syarikat Pengeluar Air Selangor Holdings (Splash) rejected the RM9.65 billion offer by Selangor state investment arm Kumpulan Darul Ehsan Berhad (KDEB).
Only state government’s subsidiary Konsortium Abass Sdn Bhd (Abass) gave the nod to the offer which will see the Selangor government take control of its equity and debts.
Under the deal inked on Feb 26, Selangor agreed to allow the federal government to construct the Langat 2 water treatment plant, in exchange for being allowed to acquire water facilities from the private concessionaires.
Many, including Pakatan Rakyat leaders have expressed reservation over the deal, largely seen as biased towards the federal government.
Petaling Jaya Utara MP Tony Pua had previously warned that the state can deny necessary approvals needed for Langat 2 to proceed should the federal government “fail to cajole” the water companies to sell their concessions back at the agreed sum.