Introduction

HEB wishes to announce that its associate company, HSS Integrated Sdn Bhd ("HSSI"), has on 28 December 2017 accepted a Letter of Appointment dated 14 December 2017 from China Communications Construction (ECRL) Sdn Bhd appointing HSSI as the Consultant to provide Supervising Consultancy Services for Infrastructure Works for the East Coast Rail Link (“ECRL”) Package 1 from KM0 to KM231.5 of the ECRL (“Contract”).

Information on the Contract

The Contract, with an estimated value of up to RM82.5 million, will commence during the first quarter of 2018 and is expected to complete within the second quarter of 2024. Pursuant to the exclusive teaming arrangement between HSSI and HEB’s wholly-owned subsidiary, HSS Engineering Sdn Bhd ("HSSE"), HSSI and HSSE will be collaborating exclusively to execute and complete the Contract. 

Financial Effects

The Contract is expected to contribute positively to the revenue, earnings and net assets of HEB Group for financial years ending 31 December 2018 to 31 December 2024.  

The Contract will not have any impact on the share capital and/or shareholding structure of HEB.

Directors’ and/or major shareholders’ interests

None of the Directors and/ or Major Shareholders of HEB and persons connected to them have any interest, direct or indirect, in the Contract.

Risk Factors

The risk factors affecting the Contract include, but not limited to, execution risks such as dependency on the progress of the ECRL given that the role pursuant to the Contract is to supervise the execution of the infrastructure works for the ECRL. HEB Group has, throughout the years, established its track record and expertise to undertake such projects. As such, the Board of Directors believes that HEB Group is able to mitigate the aforesaid risk factors.

Directors’ Statement

The Board of Directors, after considering all the relevant factors, is of the opinion that the acceptance of the Contract is in the best interest of HEB Group.

This announcement is dated 28 December 2017.