This article first appeared in The Edge Financial Daily on August 8, 2018

SHAH ALAM: Selangor Menteri Besar (MB) Amirudin Shari has dismissed his predecessor Tan Sri Ibrahim Khalid’s claim that the state government is paying 10 times more now to buy Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (SPLASH) at RM2.55 billion, compared with the previous offer of RM250.6 million in 2013.

Amirudin said SPLASH’s new price tag, which was derived on  a willing-buyer willing-seller basis, is “much lower than its

existing market price”.

“This has been answered many times in the state assembly, and Khalid was there sitting in front of Azmin,” Amirudin told reporters after attending the Roundtable on Selangor Budget 2019 here yesterday.

He said the RM2.55 billion price tag to acquire SPLASH was also lower than the value contained in the valuation deed, which was prepared by independent consultants.

He blamed Selangor’s first “unacceptable” offer in 2013, which was made under Khalid’s watch, as one of the reasons the water consolidation process was delayed and raised SPLASH’s overall valuation to RM3.54 billion from RM1.9 billion-RM2 billion.

Amirudin was responding to Khalid’s statement in a Facebook post last week, which claimed that Selangor is forking out 10 times more to acquire SPLASH, the last of four concessionaires required to complete the state’s water consolidation exercise.

Last Friday, Pengurusan Air Selangor Sdn Bhd (Air Selangor) offered to pay RM2.55 billion for SPLASH, marking an end to the water consolidation saga in Selangor that has dragged on for over five years. The offer was at a 28% discount to SPLASH’s net book value of RM3.54 billion as of end-June, Amirudin said.

Once Air Selangor completes the SPLASH buy, Amirudin said the state will continue to replace 22,000km of the water pipe network in the state on a staggered basis, a job which analysts have estimated will cost over RM1 billion.

“In the last three years, Selangor has replaced 400km out of 22,000km of the water pipe network, with more than RM500 million spent,” he said, adding that this has resulted in a marked reduction in the state’s non-revenue water rate, which has dropped to 30% from 33%.

Meanwhile, Amirudin said Selangor expects to table its state budget on Nov 23, which will focus on agricultural development to ensure food security.

“On average, the supply of meat, paddy and vegetables is far from being self-sufficient if, say, compared to eggs and chicken,” he added.