Introduction

Pursuant to the Novation Agreement dated 22nd March 2010, the appointment of SMHB Sdn Bhd ("SMHB"), an associate company of HEB, as the Principal Consultant for the consultancy services responsible for the design and supervision of Package 5: Raub to Bentong, Pahang of the Central Spine Road was novated to Government of Malaysia by East Coast Economic Region Development Council.  

HEB wishes to announce that SMHB has on 4th May 2020 received a letter from Jabatan Kerja Raya Malaysia dated 17 March 2020 confirming the provision of Construction Supervision Services by SMHB for Section 5A: Raub By Pass of Package 5: Raub to Bentong, Pahang of the Central Spine Road (“Contract”).

Information on the Contract

The details of the Contract as below:-

Pursuant to the exclusive teaming arrangement between SMHB and SMHB Engineering Sdn Bhd (“SMHBE”), a wholly-owned subsidiary of HEB, SMHB and SMHBE will be collaborating exclusively to execute and complete the Contract. 

Financial Effects

The Contract is expected to contribute positively to the revenue, earnings and net assets of HEB Group for financial years ending 31 December 2020 to 31 December 2022.  

The Contract will not have any impact on the share capital and/or shareholding structure of HEB.

Directors’ and/or major shareholders’ interests

None of the Directors and/or Major Shareholders of HEB and persons connected to them has any interest, direct or indirect, in the Contracts.

Risk Factors

The risk factors affecting the Contract include, but not limited to execution risks, such as dependency on the progress of the construction works for Section 5A: Raub By Pass of Package 5: Raub to Bentong, Pahang of the Central Spine Road given that the role of SMHB pursuant to the Contract is to supervise the construction works. Nonetheless, HEB Group has, throughout the years, established its track record and expertise in undertaking such projects. As such, the Board of Directors believes that HEB Group is able to mitigate the aforesaid risk factors.

Directors’ Statement

The Board of Directors, after considering all the relevant factors, is of the opinion that the acceptance of the Contract is in the best interest of HEB Group.

This announcement is dated 4 May 2020.