Kicking into your own goal

 

Chua Junior, you did Malaysians a great favour by exposing these issues. Unfortunately, although you may have scored, you, however, kicked the ball into your own goal. And that is what happens when you take on an issue half-baked and half-cocked, you shoot your own feet.

THE CORRIDORS OF POWER

Anak Raja Selangor

Chua Tee Yong of MCA, or I shall refer to him as Chua Junior, may have done the Pakatan Rakyat (PR) led Government of Selangor (GoS) a favour without even realising it. In fact, there are two issues that may backfire and blow up in Umno’s face -- the Talam and the Syabas issues -- not that these are the only two issues. 

Today, I want to talk about the Talam issue. Maybe I can address the Syabas issue at a later date. After all, there is already so much static about Syabas without me needing to pollute the airwaves any further.

By exposing what the previous Umno-BN led GoS was trying hard to keep under wraps, Chua Junior may have unwittingly opened the proverbial Pandora’s box.

I am, of course, referring to his Talam Debt Expose.

If the current GoS had exposed this scandal, it would not have got even one line of coverage in the mainstream media (MSM). However, because it was MCA-BN that exposed it, it gets front-page coverage for weeks on end.

Let us look at the details of the Talam Debt Settlement and see what skeletons are rattling where.

1) Debt Settlement of 2009

YB Teresa Kok had said on Tuesday that the Debt Settlement of 2009 was a continuation of the earlierDebt Settlement Agreements made in 2006 and 2007 -- that means during the previous Umno-BN State Government. 

One earlier Debt Settlement in particular is of great interest. That is, the one signed between Talam and Kumpulan Hartanah Selangor Berhad (KHSB) in 2005 -- again, under the previous Umno-BN State Government.

When this agreement was signed, Tan Sri Chan Ah Chye was a Director of KHSB and Talam was a major shareholder of KHSB. So this required KHSB calling for a Shareholders Meeting in 2005 to have the agreement approved by the shareholders. However, it was not done, as it would have meant that KHSB would have to appoint an Independent Adviser and all the shit would have been exposed -- especially the ‘haircut’ or reduction that was being given to Talam from a more than RM150 million debt to slightly over RM100 million.

So Chua Junior did the Selangor voters a favour by exposing the issue and requesting for an investigation and action to be taken, as now the Bursa and SC can investigate the matter and take the appropriate action against the Board Members of KHSB in 2005.

Interestingly enough, even the now controversial Debt Settlement in 2009 was also kept under wraps by the KHSB Board in 2009 -- which was then still being controlled by Umno/BN -- by not calling for another Shareholders Meeting to approve the 2009 Debt Settlement Agreement. I am sure the then Executive Chairman, Company Secretary, Board and Management were aware of the requirement to call for the Shareholders Meeting. But then, if they did, all would be exposed.

So, again, Chua Junior did the Selangor voters a favour by exposing the issue and requesting for an investigation and action to be taken, as now the Bursa and SC can investigate the matter and take the appropriate action on the Board Members of KHSB in 2009.

2) But what is this ALL?

How did Talam get to owe so much?

Actually, the ‘problem’ started way back in the early 2000s when the then Umno-BN GoS was hard-pressed by unit holders of their unit trust, Amanah Saham Selangor or ASAS, to redeem their units for the minimum guaranteed price of RM1.00. The price of the units was then less than 30 cents. This shows the investment expertise of the then GoS, which can reduce a RM1.00 value to less than 30 cents.

Anyway, in order to show profits and redeem the units at RM1.00, the GoS came out with a plan, or I prefer to call it a devious scheme, to increase the value of their companies by having these joint-ventures with people like Chan Ah Chye.

So, they created joint-ventures with their two public listed companies, Brisdale and SAP, and inflated the value by more than 300 million and then floated the shares through an IPO by creating two new companies, KHSB and Kumpulan Perangsang Selangor Berhad. The ‘profit’ made by the GoS in floating these companies were then used to redeem the units from the unit holders in 2003, just before the 2004 general elections. So, Prime Minister Najib Tun Razak was right, Malaysia can create history with their IPOs. This is yet another one.

But then what happened to the two companies, Brisdale and SAP?

Brisdale is today under receivership and SAP is burdened with close to RM300 in million losses due to all these failed joint-ventures.

So, as I said, Chua Junior did the Selangor voters a favour by exposing this issue.

3) Joint-Ventures

Let us now look at the controversial lands and the failed joint-ventures.

In order to create the value for the IPO, the then GoS took, as what Chua Junior is now indicating, useless pieces of land, which are more than half underwater, and placed them in the joint-ventures at inflated prices. This then created the illusion and impression that the joint-ventures would be worth much more than they really were. So, today, Chua Junior has done the GoS a favour by showing that these lands were worthless pieces of land placed to create value and nothing more.

However, good, reputable and respectable property developers would say that land with 50% water, are now prime development land for Lakeside Properties. Look at the Mines, SunWay, CyberJaya, etc.

In fact, KHSB, which also owns about 5,000 acres in the same area of Bestari Jaya, with about 50% underwater, recently signed a MoU with some Chinese investors to develop the 5,000 acres into an eco-city development with a value of more than RM8 billion. This is what I would call creating value and my hats off to the new Board and Management of KHSB, which I believe is only about a year old. 

I fully agree with the call that a Royal Commission be set up to investigate the Talam Debt. But the investigation should go as far back as possible to reveal all that happened in the dealings leading up to the debts being created.

So Chua Junior did us all a favour by exposing these issues. I wonder if Bursa, SC, MACC and others would now take the cue from Chua Junior and carry out a full-scale investigation on these dealings.

Chua Junior, you did Malaysians a great favour by exposing these issues. Unfortunately, although you may have scored, you, however, kicked the ball into your own goal. And that is what happens when you take on an issue half-baked and half-cocked, you shoot your own feet.