What do you really want? Minister asks critics of 1MDB power sale


(Malay Mail Online) – Opponents of 1Malaysia Development Bhd’s (1MDB) power asset sale to a Chinese conglomerate are doing so in the hopes of seeing the Malaysian firm fail, Datuk Seri Salleh Said Keruak suggested today.

The multimedia and communications minister noted that the critics were rejecting all options available to the state-owned investment firm for its debt rationalisation exercise, and were expressing dissatisfaction regardless of whom 1MDB chose as the buyers of its Edra Global Energy unit.

“They want 1MDB to reduce its debt, and at the same time they don’t want any local firms to buy 1MDB’s assets, and do not allow 1MDB to sell its assets to foreign investors. With that, what do they want 1MDB to do?” he wrote in a blog post today.

The Umno leader said that 1MDB has only three viable options in the matter, all of which its critics are rejecting.

“But there is a fourth alternative, which is bankruptcy. Is that the action they want 1MDB to take? So that they can use the issue against the prime minister?”

Salleh’s blog post was not addressed to any individual, but former prime minister Tun Dr Mahathir Mohamad spoke out against the deal yesterday, questioning how the sale of Edra Energy would help address 1MDB’s debt burden.

He suggested that the depreciation of the ringgit to around 4.30 to the dollar now versus the time when 1MDB had purchased the assets, when the ringgit was near 3.20 to the greenback, made the value of the transaction questionable.

Aside from Dr Mahathir, PKR secretary-general Rafizi Ramli previously sought for Parliament to block the deal, claiming that the sale of Edra Energy to the Chinese-conglomerate would undermine local energy utility Tenaga Nasional Bhd.

On Monday, 1MDB said it has agreed to sell its Edra Global Energy arm for RM9.83 billion (US$2.3 billion) to China’s General Nuclear Power Corporation (CGN) as it seeks to cut its debt and restore investor confidence.

International newswire Reuters reported that CGN will assume all of the debts of Edra Global Energy, which is the second-biggest independent power producer in Malaysia, and the deal is scheduled for completion in February.

Putrajaya granted CGN an exemption to the local law that caps foreign ownership of firms in strategic industries to no more than 49 per cent. 

In his blog, Datuk Seri Salleh Said Keruak claimed that 1MDB critics were not interested in seeing the state-owned investment firm succeed in its debt rationalisation exercise.