Zelan tenders for RM4b local infrastructure contracts in 2016

Despite the current challenging economy, Zelan is still participating in tenders for local infrastructure projects, its managing director Adnan Mohammad said.

"Yes, times are challenging in terms of securing jobs, while margins are being eroded, but we are still participating in terms of local projects. We are still targeting infrastructure projects, but whether we secure them or not depends on the tender price that we have submitted.

"Up until April, we have submitted over 10 tenders, valued more than RM4 billion. Some of the contracts being tendered out are for works for the new highways like SUKE and DASH and also infrastructure projects for Petronas' RAPID (Refinery and Petrochemical Integrated Development) project," he said.

Asked if the group is eyeing any overseas projects, Adnan said the management is focusing on its local operations, as the group aims to eventually wind down its foreign operations.

"We have legacy contracts in India and Indonesia. There are some residual issues to be finalised for the companies there before we can close down operations in the two countries.

"There are large issues to be dealt with in relation to the Abu Dhabi project arising from non-payment and interference [from] the client. We have been engaging with external lawyers and appointed arbitrators. This may only be sorted out within the next one to two years, depending on how it goes," he said.

Meanwhile, the group is also looking to grow its asset facility management (AFM) business, which currently consists of the maintenance contract for International Islamic University Malaysia (IIUM), providing some recurrent income to the company.

"We basically set up a special purpose vehicle which does the AFM for IIUM, and we are slowly building our portfolio. The contributions are not that significant currently, but we would like to grow the business," said Adnan. – theedgemarkets.com