SHAH ALAM: The nationalisation of Boustead Naval Shipyard – the builder of the LCS – has been delayed for 30 more days or longer as the parties involved need more time to complete the deal.
Boustead Heavy Industries Bhd (BHIC) announced the extension of the deal a day after the process should have been completed (October 3) to Bursa Malaysia on October 4. It said that an agreement for an extension by both parties came after the expiry of the conditional period on Tuesday.
BHIC had announced previously that the government was taking full control of the BNS and subsequently, the LCS project, for a token figure of RM1. The government however needs to pay BHIC some RM1.2 billion, most of which is liabilities incurred by BNS for the financial period of 2022 while the rest is the sum incurred by BNS to the company.
The exact amount of BNS liabilities is RM848.45 millionand RM383.94 million is the sum owed by BNS to BHIC.
According to BHIC’s past disclosures, the divestment is conditional upon fulfilling conditions precedent within thirty business days, or a further period of 21 business days or such longer period as the parties may agree.
The BHIC announcement:
We refer to the announcements dated 29 May 2023 and 21 August 2023 in relation to the Proposed Disposal.
Pursuant to the SSA, the Conditions Precedent for the Proposed Disposal shall be fulfilled within 30 Business days from the date of the SSA (“Conditional Period”) or a further period of 21 Business days (or
such longer period as the parties may agree) from the expiry of the Conditional Period (“Extended
Conditional Period”). As the Parties require additional time for the fulfilment of the Conditions Precedent, the Company and the Purchaser have mutually agreed to extend the Conditional Period of the SSA for a further period of 21 Business days from the date of expiry of the Conditional Period, 3 October 2023.
For avoidance of doubt, all other terms and conditions of the SSA remain unchanged.
This announcement is dated 4 October 2023
The announcement came a day before the Public Accounts Committee was scheduled to visit BNS in Lumut, Perak. It also did not announce whether the work on the LCS project has restarted.
— Malaysian Defence
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View Comments (7)
Likely actual physical work on LCS hasnt started. With LMS2 also delayed. No new ship for RMN until at least 2027. I guess the argument would be there are no major threats, and we plan for low intensity situations, so we are still good with existing assets, aka we dont need to spend more money to fast track decisions.
Kel - “I guess the argument would be there are no major threats”
There are “threats” but not “existential” ones [not as if Thailand is going to launch an armoured drive to Taiping or China deciding to invade Sabah and have it administered from Hainan or Singapore deciding to annex JB and relocate Gelang and all its ladies on the game there]
Did you also miss the part about the RMN badly needing new hulls because of its lack of numbers and the fact that its principal combatants are somewhat dated? Also, threats aside; the RMN still has peacetime operational commitments; so yes it needs new hulls ASAP.
Kel - “so we are still good with existing assets, aka we dont need to spend more money to fast track decisions”
With conclusions like these: it’s fairly obvious you’re a graduate of Russia’s Frunze Military and the U.S’s School of Advanced Military Studies [graduates are called “Jedis”]; as well a disciple of Motlke the Elder and Clausewitz.
It impossible for us to fast track any decisions because
1) we no longer a defacto one party state where decision is made for us without the concent of the govern by a small number of oligarchs
2) too new to the multiparty democracy and without a national identity make national consensus difficult not to mention no mechanisms to gauge which decision would get the most public support.
3)the policymakers, voters & political class has bigger fish to fry. We are afterall trapped in a middle income trapped & we need reforms & have to make lots of other difficult decisions ranging from national identity, political alignment, economics models & so on.
Even when we were one party decisions take too long, really.
zaft - ''It is impossible because''
Due process has to take place, including the spinning of the wheels of bureaucracy. That's how things work.
A lot of things were ''fast track'' with the LCS and other programmes and see how well things turned out.
zaft - ''concent of the govern by small number of oligarchs''
That's the 1st time I've heard the term ''oligarchs'' in reference to this country. Are you going to use terms like a ''apparachiks'' and ''bourgeoisie'' next? BTW certain highly influential individuals and entities still can exert large doses of influence; whether on this government the next.
Zaft - trapped in a middle income''
Ok but what on earth does that have to do with the context of this subject?
Azlan "BTW certain highly influential individuals and entities still can exert large doses of influence; whether on this government the next."
A good example is our defense procurement are designed by policymakers. While IMHO they nail their job well. It isn't really getting a lot of voters nor politician support.
Zaft - “A good example is our defense procurement are designed by policymakers. While IMHO they nail their job well”
If I read you correctly this is the funniest thing I’ve heard this year...
Zaft - “ It isn’t really getting a lot of voters nor politician support”
Sorry but would this is utter utter plain nonsense. “Support” you say? The “policy makers” are mostly politicians or they approve are the ones who approve what we get so what ““support” are you on about?