The head of the KCRC has warned against any cheap sale of the corporation's assets during a merger of the city's two railway operators. The true value of the Kowloon-Canton Railway Corporation 'can only be realised some time in the future', chairman Michael Tien Puk-sun told the South China Morning Post. 'The sale should be based on the company's future prospects rather than today's valuation.' While he supported the merger with the MTR Corporation, Mr Tien said it might not be the best time to sell the KCRC's assets because the company was still in its development stage. 'A cheap sale of KCRC will not be any good for anybody,' he said. 'It is like a farmer who just planted a large piece of remote land with some excellent seeds and a businessman is asking to buy the site. Of course the farmer would say, 'Come back at the time of harvest' or 'Pay me a price based on the harvest'. 'We should not rush to carry out the sale just for the sake of doing it,' said Mr Tien, who stressed he was not personally involved in the merger negotiations. 'We should not use the merger to save the government's budget deficit and I do not believe the government would do that. The merger is aimed at creating synergy and increasing efficiency of the two corporations.' Mr Tien said suggestions from some analysts that the government should just merge the KCRC's operations with the MTRC and withhold its assets for sale later was 'interesting and worth considering'. The MTRC and the KCRC began merger negotiations after the government - the MTRC's biggest shareholder and the sole owner of the KCRC - agreed to the plan in February. The MTRC is expected to buy the KCRC. Analysts are worried that the merger may be affected by the KCRC's declining profit. Last month it slashed its profit estimate for this year by two-thirds, to just $300 million, after the new West Rail attracted far fewer passengers than expected. Mr Tien has warned that the company could record a deficit next year or in 2006. But MTRC chairman Raymond Chien Kuo-fung said last week the West Rail operation would not affect the merger talks. Mr Tien also said the new Ma On Shan link, due to open by the end of the year, would not be profitable in its initial stage. But its East Rail extension from Hunghom to Tsim Sha Tsui, to be completed next year, would generate extra profit. He said the KCRC's balance sheet would look 'okay' in the coming few years. 'We may just make a little bit of money but our finances are healthy. The corporation's long-term future looks great,' he said.