1MDB or MoF to foot refund of RM741 mil deposit paid for Bandar Malaysia?

1MDB or MoF to foot refund of RM741 mil deposit paid for Bandar Malaysia?

By: 
Chester Tay
04/05/17, 04:56 pm

(May 4): Questions are now being raised over who will refund the RM741 million ($239 million) deposit paid by a consortium led by Iskandar Waterfront Holdings Sdn Bhd (IWH) to acquire a 60% equity interest in Bandar Malaysia Sdn Bhd after the deal was called off yesterday.

"Will 1Malaysia Development Bhd (1MDB) now refund the deposit or will the Ministry of Finance (MoF) have to once again bail 1MDB out by forking out the RM741 million?" DAP national publicity secretary and Member of Parliament for Petaling Jaya Utara Tony Pua asked in a statement today.

Pua pointed out that MoF has to also independently service the RM2.4 billion proceeds raised from the Islamic bonds (sukuk) issued two years ago by 1MDB for the purposes of the Bandar Malaysia project in Sungai Besi here.

Advertisement

In January last year, 1MDB had said parts of the proceeds were used to finance the relocation of defence units from the land marked for the 196ha Bandar Malaysia development.

"MoF will also have to bear the burden of making payments to Perbadanan Perwira Harta Malaysia, a wholly-owned subsidiary of Lembaga Tabung Angkatan Tentera, which had received a RM2.7 billion contract to relocate the air force military base, of which nearly RM2 billion are still outstanding," he noted.

Yesterday, TRX City Sdn Bhd, an indirect wholly-owned subsidiary of MoF, announced that the RM7.41 billion sale of a 60% equity interest in Bandar Malaysia Sdn Bhd has lapsed.

It stated that despite repeated extensions being granted, IWH CREC Sdn Bhd — a 60:40 joint venture between IWH and China Railway Engineering Corp (M) Sdn Bhd — had failed to meet the payment obligations outlined in the conditions precedent under the share sale agreement (SSA). "As a result, the SSA between the parties stands null and void with immediate effect," TRX City added.

Pua said he had previously questioned 1MDB and the MoF as to why the prized asset was sold to a consortium led by IWH, whose total net assets is worth barely RM3.8 billion, less than half the above transaction value. "For the financial year ended Dec 31, 2015, IWH's pre-tax profit was only RM170.4 million."

"Despite IWH clearly attempting to bite off more than it can chew, 1MDB had proudly announced on Dec 31, 2015 that IWH-Bandar Malaysia sale agreement 'marks the final major milestone in the 1MDB rationalisation plan as presented to the Cabinet on May 29, 2015'," said Pua.

"The deal was expected to be completed by June 2016, but was delayed clearly by IWH's inability of meet the agreed payment terms and schedules," he added.

Pua also called for the resignation of 1MDB president and group executive director Arul Kanda Kandasamy for the deal fallout, saying it is an "embarrassment caused to the Malaysian government".

Datapulse Tech sinks in 1Q losses on impairment loss

SINGAPORE (Dec 13): Datapulse Technology sunk into losses of $1.3 million for the 1Q18 ended October from earnings of $6.2 million a year ago. In 1Q18, revenue from continuing operations fell 31.2% to $3.9 million due to the continued shrinking demand for media storage products and services during the quarter. In 2016, the group entered into a share sale and purchase agreement to dispose of its entire shareholding in One Global Inc, a wholly-owned subsidiary in Taiwan. Other income from continuing operations rose 5.4% to $117,000. However, total operating expenses rose 4.1% to $5.3....
Read More >>

Far East Group subsidiary to sell Selangor factory property for $3.8 mil

SINGAPORE (Dec 13): Refrigeration and air-conditioning systems manufacturer Far East Group announced Wednesday that wholly-owned subsidiary Far East Maju Engineering Works has accepted a letter of offer to sell its factory property in Selangor, Malaysia for RM 11.5 million ($3.8 million). Currently used as a warehouse, the property includes a single storey factory building, a double storey office building, and a piece of freehold industrial land spanning 4,485 sqm. The proposed disposal is expected to result in a gain on disposal of approximately $2.5 million after deducting estimated re....
Read More >>

SIIC Environment subsidiary awarded BOT wastewater project in Jiangsu

SINGAPORE (Dec 13): Nanfang Water, a 91.203%-owned subsidiary of SIIC Environment Holdings, has been awarded a build-operate-transfer (BOT) contract for a wastewater project at HuangQiao Industrial Park in Taixin City, Jiangsu Province, China, by the industrial park's administrative committee.  In a Wednesday announcement, SIIC Environment says the project entails the construction and operation of a wastewater treatment plant with a design capacity of 20,000 tons per day, with a Grade 1A discharge standard for a concessionary period of 30 years beginning from the agreement signing....
Read More >>