KAB EYES JOINT-VENTURE TELECOM TOWER PROJECT IN PHILIPPINES

KUALA LUMPUR, July 14 -- Kejuruteraan Asastera Bhd (KAB) has signed a tripartite memorandum of understanding with Philippines-based conglomerate LCS Holdings Inc and ATS Venture Group Sdn Bhd to undertake a telecommunication tower project in the Philippines.

The MoU signed today affirmed LCS’ intentions to collaborate with KAB on a turnkey solution to build and operate the telecommunication tower project, a contract which was secured by LCS, the electrical and mechanical engineering company said.

“KAB will take a lead role in the financial arrangements while ATS will be the lead technology partner to support the project,” it said in a statement today.

bootstrap slideshow

KAB managing director Datuk Lai Keng Onn said the MoU represented the latest milestone for the company to venture into the telecommunication industry.

“Setting forth with this new business segment (of building and operating telecommunication towers) will grow KAB’s stable recurring income continuously, in addition to our existing business,” he said.

Under the project, KAB plans to invest in and build 300 telecommunication towers, each of which standing 45 metres tall.

“I look forward to jointly build on this new long-term strategic partnership with LCS to support the Philippines’ telecommunication industry, which has grown tremendously over the years, with the continuing appetite of many Filipinos in communicating through their mobile phones, accessing information through the internet, streaming and downloading videos,” Lai said.

On completion of the project, the telecommunication towers will be leased to Dito Telecommunity Corporation in the Philippines, which is co-owned by China state-owned China Telecommunications Corporation, the parent company of China Telecom, for a period of 15 years with an option to extend for an additional 10 years.

KAB said it would be able to enhance its recurring income with the long-term concession signed with Dito for the next 25 years.

 “This new income stream, which will contribute positively to KAB, is expected to provide revenue of RM15 million with a profit of about RM3 million per year,” it added.

-- BERNAMA