Tony Pua continues to recycle wrong statements, says 1MDB
Media statement by 1Malaysia Development Bhd (1MDB) in response to Petaling Jaya Utara MP Tony Pua’s statement
YB Tony Pua continues his disservice to all Malaysians by relying on findings of a discredited foreign blog to make his allegations, when 1MDB has submitted authentic company documents, including its Board of Directors’ (BoD) minutes, to lawful authorities such as police and the Auditor-General.
Pua knows the Auditor-General’s findings will be presented, per due process, to the Public Accounts Committee (PAC). It is self-evident that Pua is arrogantly undermining the Auditor-General investigations and the PAC hearings by selectively presenting information to score political points.
1MDB is duty bound to clarify yet again certain matters as Pua’s recycled and selective presentation of information is misleading the public.
1) Investment in PetroSaudi
The key objective of 1MDB’s US$1 billion equity investment in PetroSaudi was to obtain a 40% equity stake, which was achieved. All funds paid by 1MDB were in accordance with duly executed agreements and, as per the legal terms, payments were made to bank accounts on the instruction of PSI.
PSI confirmed that all funds transferred on its instructions were received and that no debt remained outstanding in the JV company, upon which 1MDB gained ownership.
All information related to the transaction, including the relevant agreements executed and funds flow, were presented to the BoD of 1MDB.
Where queries were raised by the BoD, clarifications were provided to their satisfaction, and the Board duly approved the agreements, which have never been cancelled.
Pua, who claims to have been a businessman before entering politics should be aware, this is standard process in any company – with the management team handling the day-to-day and detailed running of the business and the Board providing oversight.
Subsequently, it is important to note that the value of the total equity and murabaha investments of US$1.83 billion by 1MDB into PetroSaudi eventually increased via a series of transactions, to US$2.33 billion of fund units as of 31.03.2014.
We have highlighted, most recently on 10 October 2015, how US$1.39 billion of this amount has been redeemed in cash, leaving a balance of US$940 million of fund units that will form part of the “debt for asset swap” with IPIC.
2) Jho Low
1MDB has previously stated that Low has never been an adviser to, employee of, or paid by 1MDB. He was previously an adviser to TIA when it was owned by the state of Terengganu.
He resigned as an adviser in mid-May 2009 prior to TIA’s change of name and ownership into 1MDB, a Federal government owned entity.
3) No bailout
Pua claims that “1MDB is in desperate need of multi-billion bailout” but cannot “walk the talk” and share evidence to support this claim. Despite his desperate and shallow attempts to derail 1MBD’s rationalisation plan, this is being successfully implemented, as evidenced by the company receiving three binding bids for Edra Energy’s assets.
The sale of Edra, combined with the previously announced RM16 billion “debt for equity swap” with IPIC and a sale of equity in Bandar Malaysia, will result in up to RM42 billion reduction of 1MDB’s debt.
This figure does not include the cash we expect to generate from the sale of remaining land in TRX, Pulau Indah and in Penang – which makes clear that Pua’s claim of the company needing a bail-out is wrong.
If he is really interested in the truth, then Pua should allow the lawful authorities to continue with their investigations and per due process, debate the findings in the appropriate forum ie PAC and Parliament.