ALOR SETAR, Nov 22 — KXP AirportCity Holdings Sdn Bhd, a company wholly owned by the Kedah State Development Corporation (PKNK) today signed a joint venture agreement with Tahira Air Sdn Bhd to establish a special purpose vehicle (SPV) to continue the development of the Kedah Aerotropolis project.

Kedah Menteri Besar Datuk Seri Muhammad Sanusi Md Nor said the new SPV which will be named Kedah Aerotropolis Holdings Sdn Bhd will be the new developer of the project to replace the previous SPV which is said to have failed to fulfill the agreement.

"Previously we ‘signed’ (a deal) with another ‘company’ which was cancelled due to the company’s failure to deposit 125 per cent of the estimated land acquisition cost.

Within 90 days of the agreement being signed today, this SPV company (the new one) through Tahira Air will deposit 125 per cent (of the estimated land acquisition cost) which we estimate to be RM2.5 billion for us to start the land acquisition process.

"Land acquisition involves company land or even individual land for us to ‘gazette’ under Section 8 of the Land Acquisition Act 1960, (because) the condition (for land to be gazetted under) Section 8 requires a deposit of 125 per cent first,” he said at a press conference after the joint venture signing ceremony here today.

Muhammad Sanusi who is also the chairman of the board of directors of KXP AirportCity Holdings signed the agreement on behalf of KXP AirportCity Holdings, while Tahira Air was represented by Tahira Group chief executive officer Vincent Tan Kee Kim.

According to Muhammad Sanusi, the Kedah Aerotropolis project has several main development components, namely the Kulim International Airport (KXP), the Sidam Logistics, Aerospace and Manufacturing (SLAM) hub and the integrated development of commercial areas.

"We have actually been given permission... the business park, MRO (maintenance, repair and overhaul) and SLAM hub have been given ‘federal’ approved by the NCIA (Northern Corridor Implementation Authority).

"The matter we are currently managing (to obtain approval from the federal government) is the airport city or airport terminal, this management involves several technical aspects,” he said.

He said the Kedah Aerotropolis project implemented through the private finance initiative is a ‘game changer’ for the Kedah economy where it is projected to stimulate 4.5 per cent of the gross domestic product and is expected to create 24,000 job opportunities.

Kedah Aerotropolis, designed to drive Kedah’s economic transformation, will be developed on 3,965 hectares in Mukim Sidam Kiri in the Kuala Muda district. — Bernama