KUALA LUMPUR: Scomi Engineering Bhd confirms it is working with Geodesic Technique Pvt Ltd on a proposal for a 59-km monorail system for the city of Bangalore, India.

It said on May 14 the proposal was for the design, build, own, operate and transfer of the monorail system, confirming The Edge FinancialDaily report on May 13 that the company’s JV was closer to the contract.

However, Scomi Engineering said it had not entered into a formal joint-venture agreement with Geodesic as yet.

“The company will make the appropriate announcement in accordance with the Listing Requirements in the event that Scomi Engineering undertakes any material transaction or corporate action,” it said.

The EdgeFD reported the Karnataka state government in India had accepted a proposal by Geodesic Techniques, where Scomi Engineering is the technology partner, to firm up a financial proposal for a concession for the monorail project.

According to the report, a Geodesic spokesperson Sumitra Iyengar said the Karnataka government has set up a special-purpose vehicle (SPV) to manage the Bangalore monorail and airport rail link and has “frozen” the alignment of the proposed monorail.

The alignment was based on a technical proposal submitted by the Geodesic-Scomi joint venture in November last year. “Freezing” the alignment effectively means that the alignment must be used for building a monorail.   

Sumitra told The Edge Financial Daily that the government has accepted the technical proposal and has given the green light for the financial proposal. She described the establishment of the SPV and “freezing” of the alignment as  important milestones in the project.

Last November, Geodesic proposed to the Karnataka government to design, build, own, operate and transfer three monorail lines involving a total of 59km and estimated to cost about US$2.4 billion (RM8.45 billion).

Scomi Engineering, a subsidiary of Scomi Group Bhd, is Geodesic’s technical partner and is expected to have a minor stake in the joint venture that is expected to see the entry of more partners.