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Tuesday, January 6, 2015

RM2 bil cannot repay, CEO replaced: Let's see if Umno STUPID enough to believe Najib's latest 1MDB 'sandiwara'

RM2 bil cannot repay, CEO replaced: Let's see if Umno STUPID enough to believe Najib's latest 1MDB 'sandiwara'
A company which claimed itself to be doing well and is in the midst of completing a massive US$3 billion initial public offering for its energy division would not, under normal circumstances be under-going a major management shake-up. This is expecially since the 1Malaysia Development Berhad (1MDB) Chairman, Tan Sri Lodin Wok Kamaruddin has just taken the trouble to issue a lengthy statement to assure Malaysians that all is very well within the “strategic development company”.
However, the sudden surprise announcement yesterday of the “resignation” of Mohd Hazem Abd Rahman and the immediate appointment of Arul Kanda only proved that all is really not well behind the steelly façade which has been presented by both the Company as well as the Prime Minister, Dato’ Seri Najib Razak himself.
In the 1MDB statement, Tan Sri Lodin stated that Arul will be undertaking “a strategic review of the business, the objective of which is to ensure that 1MDB is best positioned to fully realise value from its investment portfolio and fulfil its broader economic objectives."
He also said that 1MDB “intend(s) to examine a full range of strategic and financial alternatives to achieve the greatest value, the outcome of which will be announced in due course."
The 1MDB Chairman’s statement clearly indicates that Mohd Hazem has been fired. He was either doing a terrible job or he has become the fall guy for the 100% Ministry of Finance owned company which has accumlated a staggering RM42 billion in debt. If not for the disastrous performance of 1MDB to date, why would there be an admission of a need for a “strategic review” and to find “financial alternatives” for 1MDB?
What is more worrying is that Mohd Hazem was only the CEO of 1MDB for less than two year. The previous CEO, Datuk Shahrol Halmi was “removed” from his position only on March 22, 2013. Two CEO changes within 24 months can only point only to poor performance and fishy business behind the scenes for the debt-ridden company.
The “sacking” of Hazem comes as 1MDB is unable to repay an outstanding RM2 billion of its debt which is due in November 2014. The RM2 billion debt is actually a portion a bigger RM5.5 billion debt which was rescheduled and restructured since November 2013.
1MDB has also failed to raise a required RM8.4 billion in loans in November 2014 to kick start a RM11 billion power plant project which was awarded by the Government in February 2014. As a result, not only 1MDB had to suffer the ignominy of postponing the fund raising exercise to this year, the power plant project delivery will be significantly delayed.
Mohd Hazem Abdul Rahman
We believe that the “sacking” of Hazem is only the start of a ripple-effect arising from the intense scrutiny placed on 1MDB, and in particular the filing of a police report by an UMNO leader against mismanagement and possible corrupt practices within the company. We call upon the Royal Malaysian Police to speed up the investigations on the company before all records are destroyed. We also ask Dato’ Seri Najib Razak, who is also the Finance Minister to agree to an audit by the Auditor-General as well as for the Company to testify to the Public Accounts Committee to ensure full transparency and accountability in his administration.
Tony Pua is MP for PJ Utara

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