Yesterday we discussed about the reports on how TNB had bailed out 1MDB after it withdrew from the Project 3B. Instead of being penalised for wasting Energy Commission’s time, 1MDB were given millions by TNB.
Imagine, 1MDB haven’t started anything yet with the project they were awarded, canceled their involvement and then get paid for it! From now on, all companies vying for projects in Malaysia will follow this trend – tender for government projects, get the award letter, don’t do anything for several months, then get paid by the next idiot who takes over the project.
1MDB even had the audacity to reply Wall Street Journal with the most nonsensical and delusional answer in history.
Asset acquisitions driven by long-term view
1MDB notes a recent Wall Street Journal article suggesting that 1MDB had overpaid for the acquisition of its energy assets. As we have previously stated, we only acquire assets when we are convinced that they represent long-term value, and to suggest that any of our acquisitions were driven by political considerations is simply false.
The fact of the matter is that these claims are a repetition of old allegations that have been driven by political opponents of the Government, including the former Prime Minister Tun Dr Mahathir Mohamad. They have never been substantiated nor supported by evidence, just as Tun Mahathir has never produced any evidence for his claim that RM42 billion was missing from 1MDB, because the reality is that this RM42 billion is debt backed by RM51 billion of assets.
1MDB takes a long-term view of value when entering into transactions; not just for the company, but for the country, as befits our 100% ultimate ownership by the government of Malaysia. The acquisition price we paid was based on this long-term view, as well as advice received from independent valuation advisers, and the prevailing market conditions at the time. On this basis, we believe that the value paid upon asset acquisition – which may have involved a premium in certain instances, as is common when acquiring another business – is commensurate with the existing and future potential of the assets.
It is important to note that since acquiring the first energy asset in 2012, 1MDB has built a leading international independent power producer in Southeast Asia. The portfolio currently comprises 13 power plants in five countries, along with the rights to construct further gas and solar-powered plants. Today, Edra Energy is the second largest independent power producer in Malaysia, and the largest in Egypt and Bangladesh, with additional operations in Pakistan and the United Arab Emirates. In total, it has gross installed capacity under management of 6,619 MW with an effective capacity of approximately 5,594 MW. – Source
What good has come out of building a leading IPP when your company health is in turmoil? It’s akin to a person arrogantly claim to build a huge house but then a short while later had to dismantle the house midway in order to service the massive loan he took to build that house. Isn’t this stupid?
Today, what can 1MDB be proud of? The Prime Minister wanted to create mega projects of his own but had done it using sovereign debts which ultimately could not be repaid. In the end, he had to sell piece by piece the assets 1MDB acquired through loans even before anything has started in order to pay the billions of loans they took.
Most of 1MDB defenders are also clamouring on the narrative that 1MDB critics must submit proof. These people and politicians alike are actually telling the rakyat if we want to criticise 1MDB, we need to show them implicating documents to prove that our questions are valid.
This kind of arrogance will prove to be a curse for Barisan Nasional. Imagine, the rakyat asked questions, but the government is asking us to furnish the proof. Are the documents being kept by the rakyat or by the government/1MDB?
Is the rakyat managing the RM42 billion debt? Is the inability of 1MDB repaying its loans due to over-stretching its debt is caused by the rakyat?
The rakyat asked questions based on the information 1MDB had released. Even this blog questioned the silly decisions and the mismanagement which made them lose money based on their own submission of information.
Yet, the rakyat is asked to show evidence to the government? From which planet did these people come from?
When critics asked questions and ran down Malaysia Airlines for losing money and getting bankrupt. Did MAS management asked the rakyat to bring proof? No, their management is not as arrogant as 1MDB’s delusional bosses.
When the MAS-AirAsia share swap was criticised by the rakyat as a bad idea, did the government asked the people to show proof of documentation that the idea was really bad? Of course not. People have common sense.
Then why is 1MDB any different? Is it because the Prime Minister is directly involved and needed to be saved by hook or by crook? Have all the 1MDB loving people lost their common sense and gone cuckoo?
Is it not enough proof that mismanagement had occurred when 1MDB needed to be rescued via a rationalisation exercise? Is it not enough proof that based on 1MDB’s own press statement that billions of cash disappeared and is mysteriously replaced by dodgy units?
Is it not proof of stupidity in managing a business when for financial year 2014, 1MDB is straddled with RM42 billion debt with net loss of nearly RM700 million in that year itself? This is not 700 ringgit or 7,000 ringgit ladies and gentlemen. It is a loss of approximately 700,000,000 ringgit! Even their cashflow statement is in the negative. Hence, by 2015, 1MDB could not continue as a going concern and has to be bailed out! Why is 1MDB so stupid?
Suddenly for the lovers of 1MDB, RM700,000,000 loss is alright and acceptable? People have been sacked, heads have rolled for something much less than that! Remember, for every ringgit lost in 1MDB, that’s one ringgit less for something that could’ve been done better elsewhere.
Is it not enough proof of management incompetency that most of the projects could not start because 1MDB now have barely any money to sustain even its basic operations?
Is it not proof that the Prime Minister holds 4 other powerful positions (Finance Minister, President of Umno, Chairman of 1MDB Board of Advisor and Chairman of Khazanah Nasional) which is perceived to render all investigations by PAC and Auditor General as useless? When the AG Report is reported not to be made public, it is indeed deemed useless by the public.
Does it not seem that with the all powerful PM clinging on to power, he is deemed as a covering up for 1MDB’s blunders and do not want to be held accountable for its failures?
There are many more questions which are not comprehensively answered but has proven to be the cause of 1MDB getting into this massive scandal.
The best news of the day came from the Finance Minister II where he said nothing is wrong with 1MDB and the company is on the right track! Husni Hanadzlah today have said:
“Before this, 1MDB was seen as a ‘fragile’ company, involved in scandals and faced various ‘online’ accusations.
“With the arrest of Justo, and based on what he said, it is clear that the various issues concerning 1MDB did not arise and that it is on the right track”.
This kind of imbecilic answer is only fit in a mental institution.
If they had been honest and did not not resort to lies when answering the questions, and did not dither in giving us the explanation, perhaps the damage caused which led to much public distrust will not be this catastrophic.
Has the Board of 1MDB and its advisors been sacked yet? Has the Finance Minister stepped down in shame for his inability to supervise 1MDB with good governance?
It seems everyone involved in wrongdoings are trying hard to cling to power. Worse, those around them are very supportive about it.
You might want to read:
1) About Justo