Thursday 28 Mar 2024
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KUALA LUMPUR (July 21): Boustead Heavy Industries Corp Bhd (BHIC) announced today that its 51%-owned unit has secured a three-year-and-eight-day extension to an original contract bagged in 2014 from the government to maintain helicopters for the Royal Malaysian Air Force for RM215 million.

It said the extension was given by the Ministry of Defence to BHIC AeroServices Sdn Bhd — a joint-venture unit with Prestige Pillar Sdn Bhd (30%) and Airbus Helicopters Malaysia Sdn Bhd (19%). 

BHIAS originally secured the contract to maintain the helicopters in March 21, 2014. It was valued at RM220 million then and was to expire after three years.

It said BHICAS obtained a letter from the ministry (extended LoA) on July 19 this year, to extend the contract for the said period from March 24. 

With the extension, it said "the consideration under the LoA (letter of award) and extended LoA is now revised to RM435 million".

Under the deal, BHIC said it will be required to provide maintenance and supply the spare parts for RMAF’s EC725 Helicopters — a twin-engine aircraft that can carry up to 29 seated troops, along with two crew, depending on customer configuration.

The helicopter is marketed for troop transport, casualty evacuation, as well as for combat search and rescue duties.

“The extended LOA will contribute positively to the earnings of BHIC for the financial year ending Dec 31, 2017 and its future earnings,” BHIC said in a filing with Bursa Malaysia today.

Shares in Main Market-listed BHIC, controlled by Lembaga Tabung Angkatan Tentera, rose 2 sen or 0.92% to close at RM2.19 today, for a market capitalisation of RM544.12 million.

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