April 22, 2021

By: The Edge Markets

KUALA LUMPUR (April 22): Boustead Heavy Industries Corp Bhd’s (BHIC) wholly-owned subsidiary has been awarded a contract worth RM78.14 million from the Ministry of Defence (Mindef) for the upkeeping of submarine facilities for the Royal Malaysian Navy.

In a bourse filing, BHIC said its BHIC Submarine Engineering Services Sdn Bhd (BSES) received the letter of acceptance from the Ministry on April 7 for the two-year job that will be in effect from Jan 1, 2021 until Dec 31, 2022.

It expects the new contract to contribute positively to its earnings for the financial year ending Dec 31, 2021.

BHIC's other subsidiary, Boustead Naval Shipyard Sdn Bhd, was appointed as the lead contractor of the RM9 billion littoral combat ships (LCS) programme, which aimed to build and deliver six advanced combat ships to the Royal Malaysian Navy.

According to an article by Nik Mohamed Rashid Nik Zurin and Liew Chin Tong, the defence ministry had confirmed that RM6 billion out of the RM9 billion had been paid out, but the first ship was only 59.79% complete.

BHIC’s shares settled half a sen or 1% higher at 50.5 sen today, giving the group a market capitalisation of RM125.47 million.