1MDB here to stay, says spokesman

1MDB spokesman stressed that the firm has no decision to sell its stakes in TRX and Bandar Malaysia, contrary to a Reuters report today. – Photo courtesy of skyscapercity.com.

1Malaysia Development Bhd (1MDB) has no plans of liquidating its assets, a spokesman for the company told news portal Kinibiz today, denying a Reuters report that it would soon be dismantled under a debt repayment plan.

"In our strategic review, we stated our intention for TRX (Tun Razak Exchange) and Bandar Malaysia to be run as standalone entities with independent governance structures and responsibility for their own operations and finances, as is presently the case with Edra Energy.

“We also stated that Edra Energy will be monetised in 2015, whilst we expect TRX and Bandar Malaysia to sell land development rights and/or enter into profit-sharing joint ventures with government-linked or private companies who can contribute not only development expertise but also equity and debt to finance specific projects,” the unnamed spokesman was quoted as saying by Kinibiz.

A Reuters report had quoted sources as saying that 1MDB would be left as a skeletal structure before being dismantled under a debt repayment plan in which most of its assets would be sold.

The report said that under the aggressive restructuring plan by 1MDB president Arul Kanda Kandasamy, the fund would sell 80% of its power unit Edra Energy via a stock market listing.

1MDB's RM42 billion debt includes a US$3 billion bond sale in 2013, one of the largest global issues from Southeast Asia.

The fund would also sell the bulk of its land assets and stakes in TRX and Bandar Malaysia as already partially indicated in a strategic review unveiled last month, the report added.

Yesterday, Prime Minister Datuk Seri Najib Razak, who also chairs the 1MDB advisory board, said he had instructed the auditor-general to look into the company's accounts. The Cabinet's weekly meeting yesterday also said it found no wrongdoings on the part of the firm.

Najib and 1MDB have come under fire after a series of exposés by whistleblower website Sarawak Report recently, where it was alleged that third party transfers worth some US$700 million had taken place.

- TMI