Firna in debt when businessman took over

Firna in debt when businessman took over

SINGAPORE - FIRNA, one of the companies at the heart of the criminal trial involving six City Harvest Church (CHC) leaders, was so deeply in the red in 2007 that it was $15 million in debt.

But after his father-in-law begged him, Indonesian businessman Wahju Hanafi decided to take it over.

"It was like a baby to him... He felt that I was the only one who had the capacity to turn this business around," he revealed on Tuesday while taking the stand as the prosecution's seventh witness.

Deputy Public Prosecutor Tan Kiat Pheng had asked for more details on how he acquired Firna which, along with Xtron Productions, allegedly issued sham bonds for pastor Kong Hee and his deputies to funnel millions into his wife (in photo above) Ho Yeow Sun's music career.

Mr Hanafi said he had prayed about it and took it as a "sign from God" when banks in Papua New Guinea, where he is based, agreed to loan him the money to buy over 80 per cent of Firna shares that his brother-in-law owned.

A month after Mr Hanafi took over the firm, which he described as one of the biggest glass manufacturers, its close competitor had to close down.

"They were flooded and there was no insurance," he said.

"All of a sudden, all their customers, all their distributors, all their overseas buyers, came to our office wanting to buy stocks from us."

By year end, the Indonesian firm was no longer losing money, said Mr Hanafi, adding that he bought the remaining shares from his father-in-law Tjandra Kusuma last year.

He also revealed that in 2007, he and his wife set up Ultimate Assets in the British Virgin Islands as a shell company, through which money was lent to Firna.

Later in 2008, Ultimate Assets entered into an agreement to manage the pop career of Ms Ho, as part of CHC's Crossover Project which was started in 2002 to reach out to non-Christians through music.

Asked by DPP Tan if Ultimate Assets had staff at the time and how it managed Ms Ho's career, Mr Hanafi said it was just his wife and him.

But he added that he has been "involved" in Ms Ho's career "from the very beginning".

For instance, he travelled with Kong to speak to American music producer Justin Herz in 2003.

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