Rafizi: Is 'high risk' Eagle High buy adhering to rules?

PKR vice-president Rafizi Ramli today urged the Federal Land Development Authority (Felda) to show that the agency's purchase of Indonesia's PT Eagle High Plantation adheres to regulation and policy.

Rafizi said the 37 percent stake purchase, which requires Felda to obtain a loan, is a high-risk venture - the same sort that auditor-general Ambrin Buang ticked Felda off in the 2010 audit report.

Ambrin had then censured Felda for making investments which breached the ruling that investments in other companies cannot be more than 24 percent of the total funds in Felda accounts, to avoid risk.

"Any director who approved the (PT Eagle High Plantations) purchase or agreed to breach the 24 percent limit can one day be probed for making decisions against Felda's interest.

"As such, I challenge Felda chairperson Shahrir Samad, and the board of directors chairperson, to explain why Felda breached its own ruling and policy on investments which were set by the Felda board itself?

"If Shahrir believes the Eagle High purchase does not breach policy and ruling, I challenge him to show the board meeting minutes that states the (24 percent investments) limit has been lifted," Rafizi said in a statement.

Shahrir yesterday said the Eagle High investment would not affect the settlers or the running of Felda itself.

He explained that the settlers' income from their smallholdings goes directly to them and the money Felda raises to fund the various activities for the settlers has nothing to do with the Eagle High investment.

"It (the investment) does not utilise any of the funds that we utilise for the business and for running Felda itself," he had said in an interview with business radio station BFM.

Insisting that the Eagle High investment has nothing to do with the Felda restructuring, he reiterated that it is a government investment.

"It is a government investment, it is only parked with us... we are the experts on palm oil," Shahrir said.

The investment came under the spotlight when CIMB chairperson Nazir Razak urged Felda to review the asking price which he said was too high for a non-controlling stake.

FGV, Felda's public-listed entity, plans to buy the 37 percent stake for US$680 million.- Mkini