Introduction

HEB wishes to announce that its associate company, HSS Integrated Sdn Bhd (“HSSI”) has on 11 November 2019 accepted a Letter of Appointment dated 8 November 2019 from China Communications Construction (ECRL) Sdn Bhd appointing HSSI to provide Consultancy Services for Preliminary Design Works for Section A of the East Coast Rail Link ("ECRL") (“Contract”). 

Information on the Contract

The Contract, with a contract value of RM14,700,000.00 will be commencing in fourth quarter of 2019 and is expected to complete within the third quarter of 2020.

Pursuant to the exclusive teaming arrangement between HSSI and HSS Engineering Sdn Bhd (“HSSE”), a wholly-owned subsidiary of HEB, 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 2019 and 31 December 2020.  

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 has 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 for the preparation and completion of the Preliminary Design for Section A of 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 11 November 2019.