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Penang undersea tunnel project has been given new life with a Kedah-based developer clinching a deal to take over the project through the purchase of majority shares in the company awarded the project.

The state government has given its blessings to the Kedah company, led by a Penang businessman with a “Tan Sri” title, to take over the project, said a source.

“The state executive council gave its nod for the takeover in early December. The new company will breathe new life into the project, which was hampered by MACC probes over the years. The Tan Sri is the white knight of the project,” the source said.

FMT has contacted chief minister Chow Kon Yeow for comment.

While the exact value of the takeover could not be ascertained, it was learnt that the incoming company would absorb liabilities and other costs as well. The source said the Kedah company will pay in instalments once work starts on each component of the project.

Last October, the tunnel and road builders Consortium Zenith Construction Sdn Bhd (CZC) told FMT that it was in the midst of an “internal restructuring” so the project could roll out smoothly.

A source had earlier told FMT that the restructuring was an effort to rescue the image of CZC and the tunnel and roads project, which had been severely affected by the corruption allegations, among others.