This article first appeared in The Edge Malaysia Weekly on October 25, 2021 - October 31, 2021

In mid-September, Minister of Finance Inc-controlled TH Heavy Engineering Bhd (THHE) was awarded a RM2 million contract by Agensi Penguatkuasaan Maritim Malaysia (APMM), or Malaysian Maritime Enforcement Agency, for emergency repairs to the latter’s ship — KM Bagan Datuk — with the work slated to be completed in four months.

This contract comes as a surprise as THHE and its partner Destini Bhd had bungled a 2017 contract from APMM to build three offshore patrol vessels (OPVs) for RM740 million. The first of the vessels was slated to be delivered in October last year but was pushed to the first quarter of this year. However, it has yet to be delivered.

Although the current contract for emergency repairs is small at only RM2 million, is APMM confident that THHE can deliver on its promises this time around?

It is also noteworthy that THHE, which has been in the cash-strapped Practice Note 17 category since April 2017, has sought another extension of time to submit its regularisation plan. The company was slated to come up with a regularisation plan, after six extensions, by Oct 22, which was last Friday. 

But if Bursa Malaysia allows THHE another extension, it would be the seventh consecutive one for the ailing company to regulate its financials. And mind you, THHE is, to the best of our knowledge, the only company to fall into the PN17 category twice — once in April 2017 and from February 2010 to October 2012.

THHE has not been performing in years and as at end-June, it had accumulated losses of RM634.54 million.

While THHE is majority-controlled by Minister of Finance Inc via Urusharta Jamaah Sdn Bhd, is it the sort of company that APMM awards contracts to, and can APMM justify the award of a new job to THHE, which has yet to deliver on an earlier contract?

Government agencies such as APMM should award contracts based on merit.

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