The Truth Revealed

Wednesday, March 21, 2012

Rafizi on Maju Holdings Deal

by Rafizi

I follow very closely the sale of Kuala Lumpur-Putrajaya highway concessions by Maju Holdings Sdn Bhd to EP Manufacturing Berhad, with reported transactions worth RM1.7 billion.

This immediately raised my suspicions as the highway was constructed using large amounts of public funds through government grants worth RM976.7 million. The overall cost of the expressway is estimated at RM1.32 billion and was mostly funded by the people through the RM976.7 million grant given by the government to Maju Holdings Sdn Bhd.

In addition to these grants, I estimate the injection of funds made by Maju Holdings Sdn Bhd was only about RM60 million (i.e 4.5% of overall costs) as they also borrowed RM370 million from financial institutions.

As a result, the sale proceeds of RM1.7 billion will provide a windfall to Maju Holdings Sdn Bhd if the government grants amounting to RM976.6 million is not refunded and paid back. If this happens, after paying their RM370 million debt to financial institutions, this means that Maju Holdings Sdn Bhd will still make a profit of about RM1.33 billion from the estimated investment capital of RM60 million.

Return the Rakyat's money

I urge the Prime Minister in his role as the Minister of Finance to confirm whether Maju Holdings Sdn Bhd will refund the total of RM976.7 million to the people, because if not, it will raise more questions that will continue to provoke people’s fury.

If the RM1.33 billion profit is kept by Maju Holdings Sdn Bhd, what are the details regarding the terms of the agreement between the Prime Minister with the owner of Maju Holdings Sdn Bhd, who are known to be supporters of UMNO? Was there an agreement that the profits, which were made from public funds, are to be channeled back to UMNO as 'elections funds'?

Lately, it has become the habit of the Prime Minister to approve transactions involving the cronies of UMNO-Barisan Nasional which are worth billions of ringgit, and this in turn has strengthened the people's fears that the high prices will boomerang to hurt them. To make it worse, the secrecy in which the transactions were all shrouded and the utter lack of transparency only adds to the people's suspicions.

2nd suspicious deal in a single month

This highway concessions sale is the second transaction this month alone involving the use of public fund. 1MDB bought the power utility assets and businesses of BN crony Ananda Krishnan. 1MDB is of course controlled by the Prime Minister, and the purchase of the Ananda assets amounted to RM8 billion. Why was Najib willing to spend such a huge sum when 1MDB clearly lacks experience in the power generation industry?

The amount of funds involved here is RM976.6 million, which is four times higher than that of NFC. The Prime Minister may think that he can get away with the NFC debacle, but surely this highway deal involving such a huge amount of public funds will require greater scrutiny and he better be ready to give some answers.

Malaysians must note that the buck for the Maju Holdings deal stops with Najib because the transactions could never go through without his consent as the Finance Minister.

Mohamed Rafizi Ramli is the Strategy Director of Parti Keadilan Rakyat (Translated by Huzainah A Rani of Malaysia Chronicle)

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