Rafizi: Why can’t 1MDB answer an easy query?

The PKR Secretary-General again asks: What has become of the bulk of the RM2.4 billion raised from a sukuk issue.

PETALING JAYA: PKR Secretary-General Rafizi Ramli has accused 1MDB of trying to confuse the public with its response to a question he posed as to the whereabouts of RM1.6 billion of the RM2.4 billion it raised last year from a sukuk bond issue.

In a press release today, Rafizi described 1MDB’s statement yesterday as “general” in nature, adding that it had failed to answer the “simple” question of how the RM1.6 billion had been spent.

Based on 1MDB’s response, he said, it was clear that the cost of relocating and upgrading the Air Force base in Sungai Besi was RM2.7 billion and that RM800 million had been paid, leaving RM 1.9 billion left to pay.

He pointed out that 1MDB admitted the RM 1.9 billion liability had to be taken over by the consortium which bought a 60 per cent stake in Bandar Malaysia.

It also admitted, he noted, that it was in the midst of negotiating with the consortium to ask it to take over the RM2.4 billion sukuk debt.

“If only RM800 of the RM2.4 billion sukuk has been spent, where has the remaining RM 1.6 billion gone to?”

He said 1MDB had stated that the funds from the sukuk issue were for the relocation and upgrading of the air base, for complying with reserve requirements as listed in the agreement, for fees and the costs incurred in issuing the bonds and for fulfilling the capital requirements of 1MDB RE, a subsidiary of the company.

Rafizi presented some calculations, estimating that 1MDB’s spending of the sukuk funds was as follows:

• RM800 million for the contractor to relocate and upgrade the air base
• RM72 million for minimum reserves to comply with reserve requirements
• RM48 million for fees and the costs incurred in issuing the bonds
• RM1.48 billion to fulfil 1MDB RE’s capital requirements

“1MDB must explain how 1MDB RE used the balance of RM1.48 billion when it is not involved in any business activities aside from being a developer at the Tun Razak Exchange and Bandar Malaysia,” he said.

“In fact, both projects have not begun and 1MDB RE’s only role is as a property broker.”

He said it was not possible that a company whose main function was to sell land would need RM1.48 billion to fund its operations.

“1MDB has given a general statement aimed at confusing the public,” he said. “It states that all the funds from the sukuk issue have been used in accordance with an agreement. But it has not answered the most important question: where has the RM1.6 billion balance from the sukuk issue gone to?”