KUALA LUMPUR: TANCO, through its indirect wholly-owned subsidiary Tanco Builders Sdn Bhd (TBSB), has secured a RM700 million contract in a consortium with CNECC Engineering (Malaysia) Sdn Bhd to undertake the construction of an industrial warehouse complex in Pulau Indah, Selangor.
In a filing with Bursa Malaysia, Tanco said TBSB and CNECC Malaysia accepted the letter of award from Jaroses Partners Sdn Bhd on Nov 5. The two parties also entered into a consortium agreement to jointly undertake and complete the project.
The development comprises two ambient warehouses, a cold storage warehouse and compressor room, an office building, a canteen and surau, as well as supporting infrastructure including a TENAGA substation, pump house, electrical rooms and a sewerage treatment plant.
The earthworks are scheduled for completion within six months from commencement, subject to the necessary regulatory approvals, while the building and remaining works are expected to be completed within 18 months from their respective commencement date.
The consortium is also required to use its best efforts to achieve Leadership in Energy and Environmental Design (LEED) Gold certification for the project.
Under the consortium agreement, TBSB will handle coordination with the project owner, CNECC Malaysia and local authorities, while CNECC Malaysia will oversee the technical, construction, procurement and project management activities.
Tanco said its revenue recognition and financial exposure would be limited to TBSB's pre-agreed fixed entitlement for its coordination and management responsibilities, rather than the full RM700 million contract value.
The group expects the project to contribute positively to its future earnings and said the award is in line with its strategy to expand and diversify its construction business through partnerships with experienced industry players.