The Revival of Bandar Malaysia (Dec 2019)

The long-awaited and controversial Bandar Malaysia which was part of the legacy of the famous state-owned 1MDB, has come to alive again today with the signing of the agreement between various parties to kick-start the project once again.

The grand signing ceremony was witnessed by Prime Minister Tun Mahathir & ambassador of China to Malaysia, and a few big guns from the cabinet ministers and businessman. Meaning, the limelight of the world is on Bandar Malaysia once again today.

In a joint statement today, the parties announced that IWH-CREC is acquiring a 60% stake in Bandar Malaysia Sdn Bhd, the project's master developer, from its parent company TRX City.

Let's have a look into details about the parties involved: >>>

Who is IWH-CREC Sdn Bnd (ICSB)?

As one of the world’s largest construction and engineering contractors, CREC takes a leading position in infrastructure construction, industrial equipment manufacturing, and real estate development. Over the decades, the CREC has built more than 2/3 of China’s national railway network and 90% of China’s electrified railway.

Who is TRX City Sdn Bhd (TRXC)?

TRXC is a wholly-owned subsidiary of the Ministry of Finance, Malaysia. TRXC was formerly a subsidiary of 1Malaysia Development Bhd before it was transferred to MoF due to mounting 1MDB debts and the inability to fund the TRXC projects, including Bandar Malaysia.

What is the valuation of BMSB?

The acquisition price of RM 6.45bil for a 60% stake in BMSB takes into account:

• the valuation of the land of RM12.35bil; and
• the RM1.6 billion of Sukuk issued by BMSB.

What are the improved terms of the New Agreement?

This revived Bandar Malaysia deal would bring substantive economic value to the nation with an expected Gross Development Value (GDV) of approximately RM140 billion. Consistent with an announcement on the Bandar Malaysia project revival by YAB Prime Minister in April 2019, this deal is viewed as an integral part of fostering and cementing long-term bilateral relations between Malaysia and China.

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