KUALA LUMPUR (July 4): KNM Group Bhd has accepted the offer for blanket working capital (BWC) facilities of up to RM160 million from Affin Islamic Bank Bhd to part finance the projects the group has secured in relation to the Refinery and Petrochemical Integrated Development (RAPID) in Pengerang, Johor.

The acceptance was made via its wholly owned unit KNM Capital (POC) Sdn Bhd.

Since 2015, KNM Group has secured over RM500 million worth of contracts from various main contractors involved in RAPID, like Toyo Engineering Corp, Tecnicas Reunidas SA and Sinopec Engineering (Group) Co Ltd.

"The BWC facilities will be secured by, inter alia, an irrevocable and unconditional guarantee by KNM," said KNM in a bourse filing today.

The BWC facilities will not have any material effect on the earnings of the KNM Group for the financial year ending Dec 31, 2016.

"Upon completion, the [RAPID] contracts are expected to generate recurring income and contribute positively to KNM's earnings in future financial years," it said.

Full utilisation of the BWC facilities could raise the group's gearing for the current financial year to 0.32 times, it noted. Based on its consolidated audited financial statements as at Dec 31, 2015, the group's gearing ratio stood at 0.27.

At market close today, KNM's share price remained unchanged at 40.5 sen, valuing it at RM863.8 million.