ANOTHER OF NAJIB’S ‘I SCRATCH YOUR BACK, YOU SCRATCH MINE’? PROTON SALE A RM1.5BIL BAILOUT FOR SYED MOKHTAR?

PROCEEDS from the Proton sale must first be used to repay a RM1.5 billion soft loan from the government to the national automaker’s present owners DRB-Hicom, said a Pakatan Harapan MP.

As the contentious deal gains more scrutiny, Petaling Jaya Utara MP Tony Pua said this move will ensure that the conglomerate’s sale of a 49.9% stake in Proton Holdings Bhd to Zhejiang Geely Holding Group Co Ltd does not in the end, burden taxpayers.

“(Prime Minister) Najib Razak must ensure that the sale of 49.9% of Proton to Geely by DRB-Hicom does not become a cover for a multi-billion ringgit bailout of the latter,” Pua wrote in a statement today.

“He must ensure that the proceeds from assets stripped from Proton must first be used to repay the government’s RM1.5 billion soft loan and not be siphoned by shareholder, DRB-Hicom.”

Pua explained that DRB-Hicom, owned by politically-connected tycoon Syed Mokhtar Al-Bukhary, stands to gain RM540 million worth of Proton properties through the 49.9% stake sale to Geely.

DRB-Hicom could also benefit from the 100 million pound (RM556 million) sale of British car company Lotus – which is owned by Proton – to Geely, Pua wrote.

These returns are in addition to a RM1.1 billion research grant from the government to Proton which will be “refunded” to DRB-Hicom and RM250 million on top of the existing RM1.25 billion in soft loans for the beleaguered company.

Proton, said Pua, will be stripped of its assets as Lotus is sold to a Geely-led joint venture and its real estate will be transferred to DRB-Hicom.

The DRB-Hicom deal with Geely comes as the former has been making hundreds of millions of losses over the past two financial years, said Pua.

For the financial years ending March 31, 2017 and 2016, DRB-Hicom recorded losses of RM260.4 million and RM871.6 million respectively, Pua wrote.

The share price of DRB-Hicom has declined by 56% from RM2.60 as at the end of 2012 to RM1.15 as at the end of 2016, he said.

“The question Malaysians are asking the prime minister is why are we allowing DRB-Hicom to benefit billions of ringgit by helping them dispose half of their loss-making company, Proton?”

“Given the factors above, the government must block the transfer of cash and assets to DRB-Hicom unless the government’s soft loan is repaid first.

“In other words, the proceeds from the 100 million pound Lotus sale and the RM540 million property transfer to DRB-Hicom must not be allowed until and unless the government is paid first.

“Otherwise, the sale of Proton has only become just a façade not only for Proton’s assets to be stripped, but for Syed Mokhtar and DRB-Hicom to benefit billions of ringgit in the process at the expense of the Malaysian taxpayers.”

– www.themalaysianinsight.com