KUALA LUMPUR, June 30 (Bernama) -- Malaysia Airports Holdings Bhd (MAHB) announced Wednesday that construction cost for the Male International Airport in Maldives is about US$373 million (US$1 = RM3.23).

A consortium comprising MAHB and India's GMR Infrastructure Ltd had entered into a concession agreement with Maldives Airport Co Ltd and Maldives' Finance Ministry and Treasury of Maldives for the expansion, operation and maintenance of the airport on June 28.

"The construction is expected to commence by mid-2011. Construction of the project must be completed no later than July 1, 2014," MAHB said in a statement to Bursa Malaysia Wednesday.

Under the agreement, tenure of the concession is 25 years, starting from the date of handover, and extendable for another 10 years subject to mutual terms and conditions between the relevant parties, the airport operator said.

MAHB said a limited liability company would be formed under Maldives laws on or before the effective date.

"The parties to the consortium are in the process of discussing the terms and conditions of the joint venture arrangement as well as the financing for the investment in MIA," it said, adding that the financial effects to MAHB could not be determined yet.

According to MAHB, the project is expected to be positive arising from the future transportation network to be commercially developed which will integrate a new transportation hub for Maldives.

"The concession agreement is not expected to have any material effect on the share capital and substantial shareholdings of MAHB," it said.

MAHB also said that it aspired to move from being a company managing local airports with a few overseas activities to being a global airport management through carefully planned investments.

-- BERNAMA