KINIBIZ Reports that Gamuda may be looking to submit a proposal to Malaysia Mining Corp (MMC Corp) to jointly launch a takeover bid of Keretapi Tanah Melayu (KTMB) in a deal worth more than RM5 billion is generating interest among analysts, despite their continuing neutral outlook on the construction company.

The railway company, which has been struggling to make profits since its incorporation despite efforts to lower costs and improve efficiency, is nonetheless an interesting proposition because of its substantial assets and land holdings which are estimated to be worth around RM50 billion.

Furthermore KTMB also has an extensive rail network which links the industrial growth centres to the seaports in Pulau Pinang, Klang, Pasir Gudang and Tanjung Pelepas while also providing landbridge services for cross border movements of cargo between Malaysia and Thailand, said the research house.

KTMB is wholly owned by the government, and it has been reported in the past that the government is open to proposals for privatisation.

News reports say that the Transport Ministry sent a due diligence letter to MMC about two years ago, and a feasibility study was carried out then, it is also believed that MMC has in the past submitted a takeover proposal to the Ministry of Finance Inc – however this was rejected as it did not meet the criteria for a takeover at that point.

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