Businessperson sues Dr M over govt acquisition of Renong

 

Businessperson Halim Saad has hauled former prime minister Dr Mahathir Mohamad, former finance minister II Nor Mohamed Yakcop, and the government to the civil court.

Filed at the Kuala Lumpur High Court on Aug 2, the civil action is over the government’s alleged deprivation of Halim’s rights as a controlling shareholder of troubled listed firm Renong Berhad in 2001.

According to the statement of claim sighted by Malaysiakini, the plaintiff claimed that this was done via virtue of Khazanah Nasional Berhad effecting a takeover of UEM Malaysia Berhad at the direction of the government as part of a compulsory acquisition between July and October 2001.

Halim claimed that the acquisition affected 372 million shares in Renong and that Mahathir and Nor Mohamed were the prime movers of the acquisition.

The plaintiff contended that his Renong shares belonged to himself and not to Umno, and that at the material time, the company held 37.92 percent stake in UEM.

Told not to proceed with Intended GO

The veteran businessperson contended that he intended to make a general offer (Intended GO) on UEM, either through Renong or jointly with Renong, to take it private as a subsidiary of Renong.

“The plaintiff was however directed by Mahathir, by Mahathir directly and through Nor Mohamed, not to proceed with the Intended GO as the government wanted, instead, to acquire all the shares in UEM through a designated entity, Khazanah Nasional Berhad or a party it was to nominate. 

“In line with this, the plaintiff was also directed to exit both UEM and Renong, both as shareholder and director including in subsidiaries of the said companies. 

“This required the plaintiff to cede his control over Renong and UEM to the government and to eventually dispose of the plaintiff's Renong Shares at a loss. The plaintiff complied with the said direction as Mahathir was then the prime minister and finance minister.

“In the upshot, Khazanah acquired all the shares in UEM through its subsidiary, Syarikat Danasaham Sdn Bhd, thereby gaining control of UEM which at the material time held 32.6 percent in Renong. In this way, the government acquired UEM indirectly and gained control and indirect ownership of the Renong group.

“The acquisition of the vested right and the deprivation of the plaintiff’s rights as a controlling shareholder of Renong, which were key aspects of the acquisition exercise by the government, were effected or caused without any compensation being paid to the plaintiff in contravention of Article 13, Federal Constitution,” Halim contended.

‘Umno owns Renong shares’

Halim claimed that he was not compensated for the acquisition of the vested right and deprivation of his right as controlling shareholder of Renong, both of which were critical to the takeover of UEM and Renong by the government.

The plaintiff claimed that despite receiving RM165 million from Khazanah, he contended this does not represent the true value of the vested right and Renong shares.

Halim claimed the part of the RM165 million, namely RM100 million was to compensate him for having paid RM100 million to UEM in connection with a Put Option which the government then was required to lapse.

He claimed the RM65 million portion of the RM165 million was to compensate him for losses due to foreclosure of various assets pledged by him to various financiers for the financing of the RM100 million.

Halim alleged that when he met Mahathir on April 23, 2010, the former prime minister purportedly told Halim that he heard from Nor Mohamed that the plaintiff's Renong shares were in fact purportedly owned by Umno, therefore the government saw no reason to compensate him.

Besides having been prime minister and finance minister, Mahathir also used to be chairperson of sovereign wealth fund Khazanah.

From September 1998 to April 2000, Nor Mohamed was an adviser to Bank Negara and worked with Mahathir to address the Asian Financial Crisis besetting Malaysia then.

Later in 2002, Nor Mohamed was appointed Khazanah director.

The plaintiff further contended that the present writ of summons is not caught by statutory limitation per the Limitation Act 1953 or the Public Authorities Protection Act 1948, as he is seeking declaratory reliefs as well as a remedy for alleged a violation of his fundamental liberties under Article 13 and Article 8 of the Federal Constitution.

Article 8 enshrines equality and entitlement to equal protection before the law, while Article 13 provides the fundamental right to property.

Among the relief sought by Halim is a declaration that the government was obliged to provide him adequate compensation for the acquisition.

Halim is represented by counsel from law firm Malik Imtiaz Sarwar.

When contacted by Malaysiakini, Mahathir’s lawyer Muhammad Rafique Rashid Ali confirmed that the former prime minister was served copies of the lawsuit earlier today.

The lawyer added that Mahathir would be responding to the civil action accordingly. - Mkini