1MDB: We have ready buyers

1MDB: We have ready buyers

KUALA LUMPUR: Three companies have offered to buy over the 0.64ha land purchased by Lem­baga Tabung Haji from 1Malaysia Development Berhad (1MDB) for RM188.5mil (S$ 69.7 million).

The pilgrim fund's chairman Datuk Seri Abdul Azeez Abdul Rahim said one offered to pay an additional RM5mil over the price of the land, and the board was waiting to see what the other two were willing to offer.

"These are private and not government-linked companies, and the deal should be completed in a week or two," he told a packed press conference at Tabung Haji headquarters yesterday.

Azeez said depositors and the public should not question later to whom the land was sold to or why it was sold to a non-Muslim company.

In defending the decision to buy the land, which was purchased by 1MDB from the Government four years ago for just RM4.5mil, he denied allegations that it was meant to bail out 1MDB but a long deliberated business decision to invest in the Tun Razak Exchange (TRX).

He said the fund's board had wanted to develop a residential tower that would have provided annual returns of 9 per cent but decided to sell the plot following advice from Datuk Seri Najib Tun Razak.

"The Prime Minster called today (yesterday) and advised us to sell it to protect Tabung Haji from being further maligned by being linked to 1MDB. That was his advice, not instruction," he added.

Azeez said the decision to sell the land was made in the interest of depositors who feared the RM188.5mil price was meant to bail out 1MDB.

He said Najib wanted the matter to be laid to rest because depositors and the public were being influenced by negative perceptions over the issue.

Azeez, who is also MP for Baling, said Umno members were questioning the move while former prime minister Tun Dr Mahathir Mohamad wanted it to be cancelled.

"We are aware of the sensitivities of the issue, especially among rural folk who are panicking over malicious claims that Tabung Haji has lost money over the deal.

"The allegations in the mass media is so intense that even my parents are being insulted," he said.

On Thursday, the fund announ­ced that it had bought the land at a discount of about 3 per cent from the fair value of the real estate assessment done by an independent valuation firm.

Stressing that Tabung Haji had paid RM188.5mil for the land va­­lued at RM194mil, Azeez said the value of the land at RM2,774 per sq ft was lower than other transactions done nearby at more than RM3,000 per sq ft, including Malaysian Resources Corporation Bhd's purchase of land from the German Embassy.

Azeez said the fund had originally received the offer to buy the plot in April 2013 for RM220mil and took about a year to evaluate before approval was finally made last month.

Brushing aside allegations of conflict of interest in the deal, he said the fund's group managing director and CEO Tan Sri Ismee Ismail, who is also on 1MBD's board, had abstained from all decision making and that deputy group managing director and deputy CEO Datuk Johan Abdullah was in charge.

Azeez said although Johan was also chairman of Edra Global Energy Berhad (a 1MDB subsidiary) there was no conflict of inte­rest because his position in Edra did not involve any decision ma­king.

Similarly he said the fund's investment panel member Tan Sri Abdul Samad Alias was just an independent adviser at 1MDB.

Azeez said he was also unfairly accused of lying after his tweet about the issue.

"I wrote 'not accurate', I did not write 'it was not true' and also that 'Tabung Haji will be issuing a statement as soon as possible'."

He was referring to the Benchmark blog's claim that the fund had entered into a deal to buy two plots of TRX land for RM722mil.

In a separate statement to address questions raised by Umno Youth, Tabung Haji confirmed that the fund paid 1MDB in full for the land.

"Yes. The board had asked for a lower price than the valuation and 1MDB agreed on the condition of 100 per cent payment.

"In addition, 1MDB also agreed to give a 2ha plot of land as security coverage of at least 1.7 times the purchase price," the statement read.

It also confirmed that the investment was regarded as "high risk" but added that this could be mitigated based on the potential deve­lopment and returns.

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