SHAH ALAM: LMS price reduction. It appears that the review of defence contracts announced by Defence Minister Mohammad Sabu shortly after being appointed in May, 2018, has been completed and the first one to be made public, is apparently the deal for the four LMS for the RMN.
The price of the original contract for the LMS was RM1.17 billion, it has now dropped to RM1.048 billion, a cut of some RM122 million. All four ships will also now be built in China instead of two in China and another two in Malaysia as off the original plan.
The latest CGI of the LMS. Note the main gun and containers on the foredeck.
KUALA LUMPUR, March 15 (Bernama) — Boustead Holdings Bhd (BHB) today announced the revision of terms of contract for the supply of four littoral mission ships for the Royal Malaysian Navy.
In a filing with Bursa Malaysia, BHB said the government agreed that all four vessels would be built and delivered in China at a revised contract price of RM1.048 billion.
BHB was referring to an earlier announcement with regard to the signing of a contract between the Ministry of Defence Malaysia and Boustead Naval Shipyard Sdn Bhd, a subsidiary of BHB, for the supply of four littoral mission ships in collaboration with a partner shipyard in China.
Under the initial contract, the first two vessels would be built and delivered in China and the remaining two would be built and delivered in Malaysia for RM1.17 billion.
Based on the small reduction in the contract cost, it is likely that the equipment originally planned for the ships will remained the same. And the cost of the four ships will still be higher than the three APMM OPVs.
As for the defence contract review, I will write more about it soon.
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