PUTRAJAYA Perdana Bhd, a construction outfit that was taken private by Petro Saudi International in 2010, is believed to have chosen MTD ACPI Engineering Bhd as its vehicle for a backdoor listing exercise, according to industry sources.

It is understood that talks have been ongoing between the shareholders of the two companies. The negotiation is at the advance level and a deal could be sealed anytime soon.

“It’s going well. Talks have been progressing and all that is left is for [Lembaga] Tabung Haji’s board to deliberate the reverse takeover (RTO) later this month,” a source says.

Tabung Haji has a 30% stake in Putrajaya Perdana, while privately held Cendana Destini Sdn Bhd controls the 70% majority stake.

Cendana Destini took over Putrajaya Perdana from UBG Bhd in 2012, after Petro Saudi International and Low Taek Jho took over the two companies as well as water infrastructure company Loh & Loh Corp Bhd in three privatisation exercises that were valued at RM1.4 billion in late 2010.

Cendana Destini’s directors are Ishak Ahmad and Mohd Faizul Ibrahim. Its shareholders are Dominant Hallmark Sdn Bhd and Rosetta Stone Sdn Bhd, both of which have equal shareholding.

At Dominant Hallmark, a filing with CCM shows that Mohd Arifin Hamzah holds a 99% stake and Mohd Faizul, 1%. The company’s directors are Ishak and Mohd Faizul.

Rosetta Stone, meanwhile, has Ishak and Mohd Faizul as its directors while Datuk Rosman Abdullah controls 99% of the company’s equity interest and Ishak has a single share.

All in, Rosman and Mohd Arifin each effectively has a 35% stake in Putrajaya Perdana while pilgrim fund Tabung Haji has 30%.

Over at MTD ACPI, the family of Tan Sri Azmil Khalili Khalid controls a 67.78% stake in the company and there are no other substantial shareholders.

While both Putrajaya Perdana and MTD ACPI are involved in construction, the latter also has a pre-cast concrete business. However, both companies’ fortunes contrast.

For the financial year ended Dec 31 last year, Putrajaya Perdana registered an after-tax profit of RM57.28 million on revenue of RM1.24 billion. As at end-2015, the company had current assets valued at RM709.90 million and non-current assets of RM361.43 million, while current liabilities were RM649.72 million and non-current liabilities, RM128.16 million. Its reserves were RM226.03 million.

The company also set up Putra Perdana Expressways Sdn Bhd, and is looking at highway concessions to increase its recurring income.

Judging by its financial track record, Putrajaya Perdana could even take the route of an initial public offering.

The construction of green buildings is its mainstay. Some of the company’s more prominent developments include the Ministry of Finance building and Parcel D of government buildings in Putrajaya as well as the 30-storey One Menerung, 50-storey Pavilion Residences, 35-storey MARC Service Suites, Bangsar Shopping Complex, 50-storey Menara Felda and 39-storey Integra Tower, all of which are in Kuala Lumpur.

In contrast, MTD ACPI suffered a net loss of RM7.95 million on revenue of RM60.13 million for the first financial quarter ended June 30 this year. Losses widened by about 40% compared to the corresponding period a year ago when the company suffered a net loss of RM5.67 million on revenue of RM49.75 million.

In the notes accompanying its financials, MTD ACPI says the performance was due to “lower result from [the] construction division, associates and joint venture and higher finance cost in other divisions”.

Except for 2013, MTD ACPI has not had a profitable year since 2009.

As at end-June this year, it had cash balances of RM64.39 million, short-term borrowings of RM61.45 million and long-term debts of RM2.32 million.

While MTD ACPI had reserves of RM193.40 million as at end-June, it also had accumulated losses of RM340.61 million.

Since early September, the stock has gained more than 50% and closed at 38.5 sen last Thursday, giving the company a market capitalisation of RM89.2 million.

Despite the rally, MTD ACPI is still trading below its net assets per share, which was at 42 sen as at end-June. Much of the company’s assets are in the form of land and buildings. According to its latest annual report for the financial year ended March 31 this year, the carrying value of its properties as at end-March was close to RM120 million.

In terms of its prospects for the year ahead, MTD ACPI says, “Going forward, the group expects the operating environment to be challenging with the balance of its order book of RM360.6 million that needs to be replenished … Barring any unforeseen circumstances, the group expects a modest recovery ahead.”

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