The pension fund does not see its takeover of PLUS to immediately affect members' dividend payments
THE Employees Provident Fund (EPF) does not expect its takeover of PLUS Expressways Bhd (5052) to immediately affect members' dividend payments but the pension fund will benefit from stable long- term returns.
"For the immediate term, there will be minimal impact, primarily because we expect the transaction (to buy PLUS) to close only the next year," EPF's deputy chief executive officer for investment Shahril Ridza Ridzuan told pressmen at a briefing in Kuala Lumpur yesterday.
The EPF declared a dividend of 5.65 per cent in 2009, better than the 4.5 per cent in 2008.
The EPF and UEM Group Bhd have made a joint offer to buy the assets and liabilities of the toll highway operator at RM23 billion or RM4.60 per share.
This allows the EPF, which already holds 12.03 per cent of PLUS, to increase its stake to 49 per cent.
"Going forward, the investment will provide us with a very steady returns," he said.
EPF has a fund size of more than RM400 billion and free cash flows of some RM1.5 billion in 2009.
"We see PLUS as a good long term investment with a steady yield and attractive returns. EPF members will directly benefit from profits generated from the highways," Shahril said.
PLUS is the concessionaire for most of the highways in the country, including the heavily-used North-South Expressway (NSE) and the North Klang Valley Expressway (NKVE).
"If (the deal is) is successful, this will provide stable returns for our 12 million members' retirement savings and we believe through the joint ownership by EPF and UEM, PLUS will be able to improve its financial performance further," he added.
Retirement funds typically invest in infrastructure assets such as power plants and toll highways because they are steady and predictable generators of cash.- By Rupinder Singh
"For the immediate term, there will be minimal impact, primarily because we expect the transaction (to buy PLUS) to close only the next year," EPF's deputy chief executive officer for investment Shahril Ridza Ridzuan told pressmen at a briefing in Kuala Lumpur yesterday.
The EPF declared a dividend of 5.65 per cent in 2009, better than the 4.5 per cent in 2008.
The EPF and UEM Group Bhd have made a joint offer to buy the assets and liabilities of the toll highway operator at RM23 billion or RM4.60 per share.
This allows the EPF, which already holds 12.03 per cent of PLUS, to increase its stake to 49 per cent.
"Going forward, the investment will provide us with a very steady returns," he said.
EPF has a fund size of more than RM400 billion and free cash flows of some RM1.5 billion in 2009.
"We see PLUS as a good long term investment with a steady yield and attractive returns. EPF members will directly benefit from profits generated from the highways," Shahril said.
PLUS is the concessionaire for most of the highways in the country, including the heavily-used North-South Expressway (NSE) and the North Klang Valley Expressway (NKVE).
"If (the deal is) is successful, this will provide stable returns for our 12 million members' retirement savings and we believe through the joint ownership by EPF and UEM, PLUS will be able to improve its financial performance further," he added.
Retirement funds typically invest in infrastructure assets such as power plants and toll highways because they are steady and predictable generators of cash.- By Rupinder Singh
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