RM5.6 billion in Khazanah asset sales under new govt

(FMT) – Malaysia’s sovereign wealth fund Khazanah Nasional Bhd sold stakes worth RM5.66 billion ringgit in seven foreign firms including Alibaba Group in the first 16 months of the current government, the Dewan Rakyat has been told.

The sale included a RM2.23 billion stake in Chinese e-commerce giant Alibaba. It was not immediately clear how large a stake it had in Alibaba, but its total overseas investments were around 14% of its total holdings, according to Reuters.

The news agency said Khazanah, which made its first loss in a decade last year, had been under pressure to raise funds for the debt-laden government of Prime Minister Mahathir Mohamad who took office in May last year.

Other sales of shares in foreign firms included stakes in BDO Unibank Inc of the Philippines, London-based fashion retailer Farfetch, Indian tech firm Infosys Ltd and poultry company PT Charoen Pokphand Indonesia Tbk.

In a written parliamentary reply to the Dewan Rakyat last Tuesday, Economic Affairs Minister Mohamed Azmin Ali said: “Seeing that Khazanah does not receive any fund injection from external sources for its investments, the proceeds from the disposals are the main resource for new investments.”

Reuters said Khazanah announced a plan earlier this year to deliver more funds to the government by pruning stakes in non-strategic assets and curbing its offshore presence.

It said Khazanah posted a loss of RM6.3 billion last year, while the realizable asset value of Khazanah’s portfolio fell 13% to RM136 billion. It has set a target pretax profit this year of at least RM5 billion – the highest in eight years, Reuters reported.