PETALING JAYA: BHIC Submarine Services Engineering Sdn Bhd (BSES), a wholly owned subsidiary of Boustead Heavy Industries Corporation Bhd, has received a letter of award from the Ministry of Defence to provide In-Service Support 2 (ISS 2) to submarines of the Royal Malaysian Navy (RMN).
The ISS 2 contract valued at RM1.1 billion commences retrospectively from Feb 15, 2024, and runs to Feb 14, 2029. BHIC expects it to contribute positively to the group’s earnings for the financial year ending Dec 31, 2024.
BHIC CEO Feroz Razi Ramli said, “The confidence shown by the government to BSES to continue providing ISS to RMN’s Prime Minister Class submarines demonstrates its trust in BHIC Group to maintain the nation’s military assets which are crucial to safeguarding its security and strategic interests.”
Meanwhile, BSES said the award of the contract stands as a testament to the company’s competence and efficiency in servicing RMN’s submarines, ensuring they perform safely and effectively to secure Malaysia’s waters. It is also a significant milestone in that a fully local company has been entrusted to manage and implement the in-service support of the RMN submarines.
BSES, which espouses inclusivity and transparency, is staffed by more than 80% Malaysians, mainly Sabahans and Sarawakians, with the core management team being former senior and experienced RMN submarines’ trained engineers and technicians. This is in line with the government’s localisation policy and will greatly assist in reducing not only the costs involved but also minimise currency outflow from the country apart from raising the bar in advanced marine technology and engineering.
In March 2023, the Defence Ministry, representing the government, awarded BSES an interim contract worth RM143 million to carry out ISS work on the submarines during which the company proved its ability by surpassing all performance targets set.
Boustead Holdings Bhd group CEO Izaddeen Daud said the award and renewal of other high-value government contracts to BHIC Group provide a positive outlook for BHIC Group’s earnings and stand testimony to its capability as one of the leading defense partners in Malaysia.
“BHIC is now poised to assume a more significant role in the defense industry by actively participating in comprehensive national defense initiatives and enhancing the supply chain within the sector, thereby solidifying our position as a key player in the industry’s future growth and development,” he said.
