I wasn’t against Boustead overhaul but wanted options, says Khaled

 

Defence minister Khaled Nordin pointed to alternative restructuring plans such as the initiative carried out by Permodalan Nasional Bhd in Sime Darby Bhd.

PETALING JAYA: 

Defence minister Khaled Nordin says he had not been against the restructuring of shareholdings of Boustead Holdings Bhd (BHB) in the plan dubbed as Project Moonshot, but had asked for studies on the plan and an alternative to it before he could bring it to the Cabinet.

A report published by the Public Accounts Committee (PAC) quoted him as pointing to alternatives such as similar restructuring carried out by Permodalan Nasional Bhd (PNB) in the case of Sime Darby Bhd.

“(PNB) used an alternative in which it had investments in many companies.

“But PNB has more than RM100 billion in funds, so they could do it. However, the Armed Forces Fund Board (LTAT) only has RM10 billion,” he said, according to the minutes of a meeting with the PAC on Aug 7 this year.

Khaled was referring to PNB’s restructuring of Sime Darby, which resulted in PNB directly owning Sime Darby’s subsidiaries involved in the plantation, property and industrial sectors.

Khaled also pointed to the “Khazanah model”, in which UEM Group is 100% owned by Khazanah Nasional Bhd and has majority shares in other companies.

“All I said was that I wanted more time.

“The board (of directors) had to convince me (which manner of restructuring) was best in the long term for what had been built up.

“Boustead’s assets are worth RM14-RM15 billion. True, their debts are around RM7 billion, but their assets are bigger than their debts.

“‘Why do you want to sell?’ That was my question,” he said.

Khaled claimed that certain parties had urged him to decide quickly on the matter, but he said he had to bring it to the Cabinet because it involved, among others, the sale of companies such as Boustead Plantation, which he did not agree with.

“I think that if I had done that, many of those here would have slammed me in Parliament.”

Earlier, the PAC was reported as hailing the now-shelved initiative to “reset” BHB, describing it as practical.

PAC said the initiative would not only have reduced LTAT’s dependence on its wholly-owned subsidiary but would also diversify LTAT’s investments in quality assets.

The committee also said the proposed initiative had been vetted and approved by LTAT and the defence ministry (Mindef) at every level, and comprehensively researched by LTAT.

“We are of the view that the decision by Mindef to discontinue the restructuring initiative by the former LTAT management hampered the transformation plan that LTAT needed to implement immediately and comprehensively,” said the PAC. - FMT