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Friday, November 30, 2012

The journey in life is never a straight line (PART 7)


Ibak had been watching this mafia for quite some time and had decided that enough is enough. He opened up the meter business to the non-cartel members and we managed to squeeze in. Within three years we walked away with RM40 million in business. But I was the most hated supplier because I ignored the mafia and refused to join the cartel in the price rigging.
NO HOLDS BARRED
Raja Petra Kamarudin
When I reflect on my corporate life, I can probably summarise it as 20 years of the 62 years that I have been walking the face of this earth. I became a businessman at age 24 and ‘retired’ at age 44. Considering that my father and mother died at ages 46 and 47 respectively, I regarded myself as almost reaching the end of my life.
Hence, maybe, a change of career was in order.
However, I have to admit that my retirement was not actually my choice but the point of frustration that I had reached. When I first started my business in 1974, you could make it with sheer hard work, ingenuity, and plenty of guts to venture into areas where angels fear to tread. However, by 1994, it was no longer about know-how but about know-who.
If you were not aligned to those who walk in the corridors of power then the doors would be closed to you. And mere ‘alignment’ was not enough. There were also the contributions you had to make to various political funds, all to be made in cash and not with traceable cheques.
I, too, was not exempted from having to ‘buy’ contracts. In the beginning it was not too bad. A RM500,000 donation to Umno for a RM30 million contract where you earn at least 8% or RM2.4 million was affordable. You still had some money left in your pocket. But when margins dropped to less than 5% and the commissions (or kickbacks) increased to 10%, it was pointless to continue with that type of business.
My wife, Marina, was actually the one who ‘pulled the plug’, so to speak. As I wrote in the earlier parts of this series, we became ‘Born Again’ Muslims in the late 1970s and by the early 1980s I was practically a radical Muslim who believed in the Iranian Islamic Revolution and dreamed of such a revolution in Malaysia.
I also became closer to PAS, although still very much a ‘closet’ supporter because of my business activities. I so very much wanted to come out into the open but I would first have to get out of business to do that. Hence it would have been just a matter of time before I made this switch.
One day, Marina asked me how we could consider ourselves as true Muslims and at the same time indulge inharam activities. When she said haram activities she meant indulging in bribes and giving money to Umno, the enemy of Islam.
What she said made sense but I needed a ‘trigger’ to spur me into doing the right thing. And that ‘right thing’ offered itself in the early 1990s. And that story goes as follows.
By 1990, I felt that a change of course was required. For the past 16 years we had been acting as a mere dealer, distributor or agent. No doubt not all our businesses were government business -- maybe about 20% or so -- but we were just selling ‘other people’s products’ and, therefore, were at their mercy.
We needed a product of our own.
I spoke to a friend in TNB and, interestingly enough, he told me that a certain ‘mafia’ monopolised the electricity meter business and they had formed a cartel and was rigging the price. TNB, therefore, was at their mercy.
I then spoke to someone in GE Singapore who gave me a list of all the electricity meter manufacturers in the world. I found that one manufacturer, Schlumberger from France, was not marketing their meters in Malaysia. (There were many others, of course, but Schlumberger was the best amongst them).
I flew to Paris and met up with a man named Arman Carlier. I proposed a partnership with Schlumberger to manufacture their meters in Malaysia and to try to break into the TNB market.
Arman did not think it was viable. Even ‘strong’ companies like George Kent (M) Bhd (a company linked to Prime Minister Najib Tun Razak) failed to break into the TNB market. And their meters are actually very good -- Landis and Gyr. So what makes me think we can succeed where others have failed?
I told Arman that our meters must be fully manufactured in ASEAN, with maybe 30% of the components locally manufactured in Malaysia -- and the local content to be increased as we go along. We must then ‘dive’ at least 20% below the prices of the cartel (they all tender at almost the same price with a couple of Sen price difference).
I was confident we could demolish the cartel and beat the ‘mafia’ that was merely importing their meters and doing a ‘bolt-and-nut’ operation. But Arman was still not sure. He knows the TBN market, as Schlumberger had done other business with them, so he knows the mafia has a strong hold on the meter business.
I told Arman that if Schlumberger agrees to set up a factory in Malaysia and they fail to get any business, I was prepared to underwrite the entire operation and reimburse them for all their expenses.
Arman finally agreed and said that he will give the Malaysian operation one year to get the business and that if we fail he will then close the factory down. We sealed the deal and then went to ‘Le Crazy Horse’ (SEE HERE) to celebrate our new partnership.
The factory was set up but after one year we got nothing. So much time and money spent with nothing to show for it. Arman told me it was time to close shop unless I could assure him we would be able to get at least some business.
I asked him for an extension of three months and he agreed. But that was it. Another three months and then they were going to close shop.
The mafia was determined to keep us out. In the meantime, the cartel was laughing all the way to the bank. I was bracing myself for bad news at the end of that three-month extension.
As I said earlier, a drowning man can come up only three times before he goes down for good. I had gone down twice so far, once in 1975 and again in 1985-1987. It looks like this time I was going to go down for good.
Then, suddenly, the unexpected happened. The General Manager, who was not supposed to retire yet, retired. He got a ‘golden handshake’ involving a large coal supply contract to prompt him to retire. His deputy, Datuk Ibak Abu Hussein, took over as the new number one.
Ibak had been watching this mafia for quite some time and had decided that enough is enough. He opened up the meter business to the non-cartel members and we managed to squeeze in. Within three years we walked away with RM40 million in business. But I was the most hated supplier because I ignored the mafia and refused to join the cartel in the price rigging.
What a stroke of luck! Schlumberger was just days away from closing down the operation. And that would have meant I would have lost my pants, for the third time. But fate decided it was not yet time for me to die.
Unfortunately, Ibak did not last long as the head honcho of TNB (the mafia hated him as well). He was ‘pushed’ into retirement and Ani Arope, a Tun Dr Mahathir Mohamad-Anwar Ibrahim man, took over (the first time in history an ‘outsider’ was appointed as the head of TNB).
And that allowed the mafia to bounce back and go for me with a vengeance.
We soon began to lose tender after tender even though our price was the cheapest by far. By the third tender we lost, the TNB mafia approached Schlumberger and told them that as long as Raja Petra Kamarudin is their partner they are never going to get any business from TNB. We also lost the fourth tender and this convinced Schlumberger that the mafia was serious about it.
The second unfortunate thing was that Arman Carlier had been transferred to another division and was no longer heading the meter business in France. The new chap had no ‘history’ with me so there was no sentimental attachment. Hence he made the decision to ‘file for a divorce’.
Schlumberger took on a new Malaysian partner who was ‘highly recommended’ by the TNB mafia. I found out later that his new partner was linked to Anwar Ibrahim. So it was an ‘inside job’ after all.
I was so furious I decided to get out of this whole ‘rat race’ once and for all. This was getting very stressful. Fighting your competitors is one thing. But when your ‘own people’ stab you in the back and grab what you painfully built up with a lot of risks involved, there was just no point in continuing.
I never forgave Anwar’s people for taking away my last shot at making it in the business world. Anwar was the Finance Minister and TNB reported to him. But I never once walked into his office to ask for any help all that time he was Finance Minister (Anwar actually complained about this to one ABIM chap). But for his people to take away what I felt belonged to me was something so intolerable that I decided to throw in the towel and go for a career change.
And this new career change was to become a political activist and political writer. I was part of the corrupt system. I worked within that system that eventually ‘ate’ me up as well. Now I was going to fight that very system I had operated in.
That was 18 years ago in 1994. Today, I am still doing what I started 18 years ago back in 1994. I now have very low tolerance for abuse of power and corruption, even when committed by those from Pakatan Rakyat. And trust me, it does happen in Pakatan Rakyat as well. After all, many of those Pakatan Rakyat people are the same people who ‘makan’ me back in the 1990s.
TO BE CONTINUED

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