Malaysia: Johor government to acquire water services company SAJ Ranhill

Halim Said New Straits Times 26 Nov 17;

ISKANDAR PUTERI: The Johor state government will soon sit in a meeting with SAJ Ranhill Sdn Bhd to embark on a move to gain full control over the water company operation in the state by acquiring the majority shares in the company equity.

State public works, rural and regional development committee chairman Datuk Hasni Mohamed said the move to increase the state government shares in the water utility company was to reposition itself in the state water management operations in terms of having power to control and obtaining rights in decision making relating to the water development in the state.

Hasni said at current the state do not have a say in SAJ Ranhill operations as it only holds 20 per cent shares of the company equity which limits its power to monitoring, and restricted to regulating the water supply and distributions in the state only.

"If the move to increase the state government shares via full acquisition of its equity or at 51 per cent of the shares, it will be purely base on revisioning our business planning with SAJ Ranhill and not a hostile takeover," he told the press during a break at the 13th State Assembly meeting.

Hasni said the matter was raised during the assembly meeting in response to Bukit Permai and Rengit assemblymen questions on the state water operations since the last water restructuring exercise between SAJ Ranhill and the Johor government made almost a decade ago.

Hasni said the state government is also open to options.

He said SAJ Ranhill president and chief executive officer Tan Sri Hamdan Mohamad will probably attend the meeting.

"The meeting will include Johor Menteri Besar Datuk Seri Mohamed Khaled Nordin and I, as the outcome of the decision will also look into the water consumption of the Johor consumers," he said.

Hasni said with the insertion of state government as main shareholders in the equity will give autonomous power for the government to regulate the state water tariff and development spending on state water assets and resources.

He also said the move was to safeguard the state government water assets and resources from external takeover should SAJ Ranhill plans to sell off its shares in future.

"However the move would require a review and subjected to an approval from the National Water Service Commission (SPAN) for the state government to have full control over SAJ Ranhill water operation in the state," he said.


SAJ Ranhill cannot supply water to Forest City, Johor State Assembly told
The Star 27 Nov 17;

ISKANDAR PUTERI: The Johore state assembly today debated that water supply services company, SAJ Ranhill Sdn Bhd, might supply water to the developer of the Forest City project in Gelang Patah.

Forest City is a 1,386 hectare mixed development project, which includes a smart city on man-made islands along the Johor Straits.

Datuk Tengku Putra Haron Aminurrashid Tengku Haamid Jumat (BN-Kempas) said such a move would be against the state's government's decision that the developer source its own water supply for the project.

"I understand that the state government has conveyed this decision to the developer. Forest City has to draw water from a desalination process or through other mechanisms deemed fit.

“This will allow the state government to accord priority to domestic households,” he said, adding that rumours were rife that Forest City would obtain water supply from SAJ Ranhill.

“If there is truth in the rumour, then this just goes to show the developer's irresponsible attitude and total disregard for the state's government's clear directive to source its own water supply,” he said in the Johore state assembly here today.

He also said Johoreans should not suffer at the expense of the developer's profit-oriented motive which could spark a water crisis in the state.

Tengku Putra Haron revealed that the Forest City project, when completed, required more than 600 million cubic meters of water, daily, which was almost equal to Johor Bahru and Pasir Gudang's daily water supply.

Based on the high demand for water supply, he was concerned that SAJ Ranhill Sdn Bhd may compromise on domestic household supply.

"I am worried that this can create a very serious water crisis if the issue is not delved into deeply,” he added.

Tengku Putra Haron Aminurrashid also urged the state government to take control of SAJ Ranhill Sdn Bhd via a mandatory takeover for fear that it may fall into the hands of a foreign party.

He suggested that the state government, which had cash reserves close to RM4 billion, acquire SAJ Ranhill Sdn Bhd from its majority shareholder, Ranhill Holdings Bhd

"It's possible that the major shareholder may sell SAJ Ranhill Sdn Bhd to a foreign party. If that happens, we will lose control of not only our water industry but our national sovereign asset,” he pointed out.

Johor assembly hears concerns over Forest City's water supply
Straits Times 27 Nov 17;

ISKANDAR PUTERI - A Johor politician told the state assembly on Monday (Nov 27) that the Johor government had told developer of the Forest City project to source for its own water supply.

Tengku Putra Haron Aminurrashid Tengku Hamid Jumat, an assemblyman for the ruling Barisan Nasional coalition, was quoted by Bernama news agency as saying that if Forest City does not get its own supply from desalination or by other means, it could spark a water crisis in Johor.

This was the first time that the issue of how Forest City would get its water supply was raised, with the government assemblyman using unusually blunt language.

The giant project involves the raising of four man-made islands totalling 1,386 ha in the Johor Strait facing Tuas.

The project is majority owned by China's Country Garden Holdings. Its other shareholders are the Johor government and Johor's Sultan Ibrahim Sultan Iskandar.

When fully completed, it is meant to house some 700,000 people.

Datuk Tengku Putra said the project, when completed, would require more than 600 million cubic meters of water daily.

This was almost equal to the amount supplied daily to Johor Baru city and its neighbouring Pasir Gudang district, Bernama quoted him as saying.

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"I understand that the state government has conveyed this decision (of water supply) to the developer. Forest City has to draw water from a desalination process or through other mechanisms deemed fit," he was quoted as saying.

"This will allow the state government to accord priority to domestic households," he said, adding that rumours were rife that Forest City would obtain water supply from the state's main water company SAJ Ranhill.

He told the state legislature, as reported by Bernama: "If there is truth in the rumour, then this just goes to show the developer's irresponsible attitude and total disregard for the state's government's clear directive to source its own water supply."

He added that Johor residents, totalling 3.6 million people, should not suffer at the expense of the developer's profit-oriented motive which could spark a water crisis.

He said he is concerned that SAJ Ranhill may compromise on domestic household supply.

"I am worried that this can create a very serious water crisis if the issue is not delved into deeply," he was quoted as saying.

Mr Tengku Putra urged the state government to take control of SAJ Ranhill via a mandatory takeover for fear that it may fall into the hands of a foreign party. He did not elaborate.

He suggested that the state government, which had cash reserves close to RM4 billion (S$1.31 billion), acquire SAJ Ranhill from its majority shareholder Ranhill Holdings.

"It's possible that the major shareholder may sell SAJ Ranhill to a foreign party. If that happens, we will lose control of not only our water industry but our national sovereign asset," Bernama quoted him as saying.

Kempas assemblyman urges Johor govt to assume control of SAJ Ranhill
Halim Said New Straits Times 27 Nov 17;

ISKANDAR PUTERI: A Johor state assemblyman has called for the state government to take full control of SAJ Ranhill Sdn Bhd.

At the 13th Johor State Assembly Meeting yesterday, Kempas assemblyman Datuk Tengku Putra Haron Aminurrashid said the state government should push for compulsory acquisition amid fears that the integrated water supply company may fall into foreign hands.

He said that with a cash reserve of almost RM4 billion, the state government can afford to acquire SAJ Ranhill through its majority shareholder, a public-listed company Ranhill Holding Bhd for a fraction of the amount.

“However remote this may be, there is still a possibility that Ranhill is sold by its majority shareholder to investors from a neighbouring country. In such a situation, we would lose control over not only of the water industry but also a national treasure which symbolises our sovereignty.

“If this happens, we could also subject the state to the possibility of economic sabotage by the competing foreign country. This would put to a halt to the state government’s aspiration of being an economic powerhouse in Southeast Asia,” he said.

Tengku Putra said the state government can make an offer to Ranhill for this to take effect, failing which, the state government should seek for a compulsory acquisition of the company under the provisions of the Water Services Industry Act 2006.

Under Section 114 of the Act, the federal government through the Ministry of Energy, Green Technology and Water can exercise its rights and powers as well as any other relevant acts, statutes or regulations to assist the state government in the compulsory acquisition of the water company.

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 Johor.

“It is time for the state government to restore the ownership of the Johor water company to the people of Johor and that it should be done without delay,” he added.

Tengku Putra also called for a forensic audit on the water tariff between the state government and SAJ Ranhill as provided for under the Water Supply Agreement 2009.

He said that under the agreement, the state government is selling water to SAJ Ranhill at a much lower rate than that to Petronas for the Pengerang project.

“If the same rate is imposed, the state government could have collected an additional revenue of millions of ringgit which can be distributed for the development of the state and the people,” he said.

Tengku Putra also raised the issue of SAJ Ranhill possibly offering to supply water to the developers of Forest City, saying that this goes against the state government’s decision for the project to find its own water resources.

“I understand that the state government had informed the developers that they have to seek their own water resources either through desalination process or through other mechanisms deemed fit by the developers. This will enable the state government to prioritise the use of water resources for the domestic needs. The rakyat must come first.”


Ranhill says no plans to sell SAJ Ranhill
The Star 27 Nov 17;

It issued the statement on Monday to refute a news article entitled “Johor government to acquire water services company SAJ Ranhill”.

“On behalf of the board of Ranhill, the company wishes to clarify that the company is not aware of the proposed acquisition by the Johor state government.

“The company has no intention to divest its present equity stake of 80% held in SAJ Ranhill Sdn Bhd,” it said.


Providing water to Forest City goes against state’s decision
zazali musa The Star 29 Nov 17;

ISKANDAR PUTERI: A Barisan Nasional lawmaker raised the issue of SAJ Ranhill Sdn Bhd offering to supply water to the developers of Forest City project during the Johor state assembly sitting.

Datuk Tengku Putra Haron Aminurrashid Jumat (BN-Kempas) said this goes against the state government’s decision for the project to find its own water resources.

“The state government had informed the developers that they have to seek their own water resources through desalination process or through other mechanisms deemed fit by the developers.

“This would enable the state government to prioritise the use of water resources for domestic needs.

Tengku Putra Haron said the state would be exposed to the possibility of a water crisis as Forest City requires about 600 million cubic litres of water daily.

He said the amount was equal to the water demand for all areas in Johor Baru and Pasir Gudang.

Tengku Putra Haron added that his constituency and several districts in the state were subjected to water rationing exercise last year because of a water crisis in Johor.

He had called upon the state government to take over water operator SAJ Ranhill through compulsory acquisition amid fears that the integrated water supply company might fall into foreign hands.

Tengku Putra Haron said with a cash reserve of almost RM4bil, the state government could afford to acquire SAJ Ranhill through its majority shareholder, public-listed Ranhill Holdings Bhd.

However remote the possibility may be, Ranhill could be sold by its majority shareholder to investors from a neighbouring country.

In such a situation, the state would lose control over not only the water industry, but also a national treasure which symbolises Johor’s sovereignty, he added.

Tengku Putra Haron said if this happened, Johor could also be subject to the possibility of economic sabotage by a competing foreign country.

He said this would put a halt to the state government’s aspiration of being a new economic powerhouse in the region.


Concerns aired over Forest City water supply
Johor politician warns of water crisis if project does not source for its own supply
Straits Times 28 Nov 17;

ISKANDAR PUTERI • A Johor politician told the state assembly yesterday that the Johor government had told the developer of the Forest City project to source for its own water supply.

Tengku Putra Haron Aminurrashid Tengku Hamid Jumat, an assemblyman for the ruling Barisan Nasional coalition, was quoted by Bernama news agency as saying that if Forest City does not get its own supply from desalination or by other means, it could spark a water crisis in Johor.

This was the first time that the issue of how Forest City would get its water supply was raised, with the government assemblyman using unusually blunt language.


The project involves the raising of four man-made islands totalling 1,386ha in the Johor Strait facing Tuas. It is majority owned by China's Country Garden Holdings. Its other shareholders are the Johor government and Johor's Sultan Ibrahim Sultan Iskandar. When fully completed, it is meant to house some 700,000 people.

Datuk Tengku Putra said the project, when completed, would require over 600 million cubic metres of water daily - almost equal to the amount supplied daily to the city of Johor Baru and the neighbouring Pasir Gudang district.

"I understand that the state government has conveyed this decision (of the water supply) to the developer. Forest City has to draw water from a desalination process or through other mechanisms deemed fit," he added.

"This will allow the state government to accord priority to domestic households," he said, adding that rumours were rife that Forest City would obtain its water supply from the state's main water company SAJ Ranhill.

He told the state legislature, as reported by Bernama: "If there is truth in the rumour, then this just goes to show the developer's irresponsible attitude and total disregard for the state government's clear directive to source for its own water supply."

He added that Johor's 3.6 million residents should not suffer at the expense of the developer's profit-oriented motive which could spark a water crisis.

He also said he is concerned that SAJ Ranhill may compromise on domestic household supply.

"I am worried that this can create a very serious water crisis if the issue is not delved into deeply," he was quoted as saying.

Mr Tengku Putra urged the state government to take control of SAJ Ranhill via a mandatory takeover for fear that it may fall into the hands of a foreign party. He did not elaborate.

He suggested that the state government, which had cash reserves of close to RM4 billion (S$1.31 billion), acquire SAJ Ranhill from its majority shareholder Ranhill Holdings. "It's possible that the major shareholder may sell SAJ Ranhill to a foreign party. If that happens, we will lose control of not only our water industry, but also our national sovereign asset," he said.