Putrajaya is hoping to see light at the end of the tunnel with its restructuring plan for 1MDB, but Dr Mahathir Mohamad continues to harp on lost public funds.
In a blog posting today, the former prime minister said plans to get International Petroleum Investment Company (IPIC) to pump another US$3 billion into 1MDB in exchange for the latter's lands will only come at the expense of taxpayers.
This is because 1MDB acquired the lands cheaply from the government, which Mahathir described as an "abuse of authority", and will now hand it to a foreign company to settle its debts.
"1MDB acquired government land worth between RM4,000 and RM7,000 per square foot at RM60 to RM90 per square foot.
"Actually the price paid by 1MDB for government land represents or reflects an abuse of authority.
"The right thing to do is to pay the market price of the land before it is developed or disposed of," he said.
Mahathir said this in reference to 1MDB's Tun Razak Exchange and Bandar Malaysia land banks.
1MDB struggling to replay loans
1MDB, which is owned by the Finance Ministry, has been struggling to repay its RM41.8 billion in loans.
Last Friday, Finance Minister II Ahmad Husni Hanadzlah said 1MDB had entered into a deal with IPIC, which will take over 1MDB's US$1 billion debt.
Husni (photo) said 1MDB may get another US$3 billion soon from IPIC and its subsidiary, Aabar Investments.
He insisted that this money was not a loan nor gift and is from an actual business transaction.
However, Husni refused to reveal any details.
While Mahathir hopes the restructuring plan will help 1MDB, he also expressed reservations.
"So how does this restructuring benefit 1MDB? 1MDB would lose control to IPIC (and) any development of the land wuill be acceded to IPIC.
"Having lost the most valuable part of its assets, how can 1MDB raise money?
"1MDB will still have to pay interest on the balance of the loan, and eventually billions of ringgit, to settle the loans," he said.
Furthermore, Mahathir added, with 1MDB overpaying for the power assets it purchased will also cause the company to lose at least RM3 billion when it tries to sell them.
In a blog posting today, the former prime minister said plans to get International Petroleum Investment Company (IPIC) to pump another US$3 billion into 1MDB in exchange for the latter's lands will only come at the expense of taxpayers.
This is because 1MDB acquired the lands cheaply from the government, which Mahathir described as an "abuse of authority", and will now hand it to a foreign company to settle its debts."1MDB acquired government land worth between RM4,000 and RM7,000 per square foot at RM60 to RM90 per square foot.
"Actually the price paid by 1MDB for government land represents or reflects an abuse of authority.
"The right thing to do is to pay the market price of the land before it is developed or disposed of," he said.
Mahathir said this in reference to 1MDB's Tun Razak Exchange and Bandar Malaysia land banks.
1MDB struggling to replay loans
1MDB, which is owned by the Finance Ministry, has been struggling to repay its RM41.8 billion in loans.
Last Friday, Finance Minister II Ahmad Husni Hanadzlah said 1MDB had entered into a deal with IPIC, which will take over 1MDB's US$1 billion debt.
Husni (photo) said 1MDB may get another US$3 billion soon from IPIC and its subsidiary, Aabar Investments.He insisted that this money was not a loan nor gift and is from an actual business transaction.
However, Husni refused to reveal any details.
While Mahathir hopes the restructuring plan will help 1MDB, he also expressed reservations.
"So how does this restructuring benefit 1MDB? 1MDB would lose control to IPIC (and) any development of the land wuill be acceded to IPIC.
"Having lost the most valuable part of its assets, how can 1MDB raise money?
"1MDB will still have to pay interest on the balance of the loan, and eventually billions of ringgit, to settle the loans," he said.
Furthermore, Mahathir added, with 1MDB overpaying for the power assets it purchased will also cause the company to lose at least RM3 billion when it tries to sell them.
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