Reveal sale & purchase agreements with China, 1MDB told

Petaling Jaya Utara MP Tony Pua has urged state investment arm 1MDB to make public the sale and purchase agreements signed for China's 60 percent stake in Bandar Malaysia, following an alleged discrepancy over its announced price.

"We call upon 1MDB to make public the sale and purchase agreement signed between 1MDB Real Estate and Iskandar Waterfront Holdings-China Railway Engineering Corporation consortium to ensure that there will be no ambiguity to the understanding of the agreement between the relevant parties.

"That way, no one can accuse 1MDB of being selective in the information it reveals to the public and Malaysians will not be concerned if there are salient and substantive terms in the agreement which are possibly detrimental to the interest of 1MDB and the Malaysian taxpayers," Pua said in a statement.

In making the call, Pua referred to 1MDB's media announcement on Dec 31 and China Railway Group Limited's statement to the Hong Kong Exchange on Jan 3.

"1MDB announced that the IWH-CREC Consortium has valued 100 percent of the Bandar Malaysia land at RM12.35 billion. Accordingly, its 60 percent share of land will cost RM7.41 billion.

"1MDB will receive a 10 percent deposit of RM741 million upon execution of the share sale and purchase agreement, with completion of the transaction expected by end-June 2016," he said.

'Glaring difference'

On the other hand, Pua noted that China Railway Group had announced that the joint venture will purchase 60 percent of the equity interest in Bandar Malaysia held by 1MDB Real Estate at a price of RM5.279 billion.

This, he said, was a "glaring difference" that 1MDB should have explained in order to allay market confusion.

"Was it merely an innocent difference in the interpretation of the 'purchase price' for the 60 percent stake in Bandar Malaysia by the China-led consortium?

"For example, 1MDB was talking about the value of the land, while China Railway was talking about the actual purchase price," he said, adding that the differing figures do not make sense.

At the same time, Pua also questioned whether 1MDB had announced an "inflated figure" to make Prime Minister Najib Abdul Razak look good.

"Perhaps, 1MDB did not expect China Railway to make an announcement to the Hong Kong Exchange, or that there will be parties who would actually read the announcement," he said.

1MDB chief executive Arul Kanda Kandasamy had said the deal is the final major milestone in 1MDB's rationalisation plan, following the execution of the binding term sheet with International Petroleum Investment Co (IPIC) and the sale of Edra Global Energy to China General Nuclear Power Corporation (CGN).

The rationalisation plan was to help turn the troubled state fund around, which has reported a debt of RM42 billion. -Mkini