|
Malaysia Sidelines Former Economic Tsar's Friends
KUALA LUMPUR, July 20 (IslamOnline) - Malaysia has started a campaign cleansing operatives linked to former Finance Minister Tun Daim Zainuddin. On Friday, the Malaysian Premier confirmed that his government was taking control of the debt-ridden Renong Berhad.
The company, controlled by Tan Sri Halim Saad, has been under intense pressure since the 1997 economic crash that affected Malaysia, sending its economy into the red.
The opposition in Malaysia, who termed it a cleansing exercise, criticized the proposed takeover of the company by the government.
A member of the opposition added that it was a bid to clean the damaged "reputation" of the regime, which has been rigged by cronyism.
Prime Minister Mahathir Mohamad said the executive post of the grouping would be confined to the current manager of the Danaharta Nasional Bhd (DANAHARTA), Azman Yahya.
Renong has long been seen as the financial arm of the ruling United Malays National Organization (UMNO), benefiting largely from the affirmative action plan that guarantees assistance to Malay-Muslims in Malaysia.
Its chairman, Halim Saad, was one of the richest men in Malaysia before the fatal 1997 crash, which exposed the billion dollar debts accumulated by Renong.
The group was strongly traded on the stock market, turning into a blue chip and a market leader in which members of the UMNO would cash in on share trading.
The salvation plan for Renong group reminds the opposition of the Perwaja Steel Bhd group that went bankrupt seven years ago, leaving behind a trail of debts and empty coffers.
Renong, however, was a success story, spearheading into the arena of trade, industry and technology, and propelling Tan Sri Halim Saad as one of the most successful young Malay-Muslims in the country.
On the takeover bid, Mahathir said that even though he is not supposed to divulge information due to the effect it might have on the market, what he could say is that the government has formally decided to find a solution to the problems affecting the company.
Sources in Kuala Lumpur say that Halim Saad, a close confident to former finance ministers Anwar Ibrahim (currently in jail, serving a 15 year sentence for sodomy and corruption), and Zainuddin, had already bailed himself out of the Renong group.
Renong Bhd owns several other companies such as the powerful United Engineers (Malaysia) Bhd (UEM), the Toll Service Company PLUS, the light rail transit system (Putra) and the Prolink, all of which had accumulated debts amounting to seven billion dollars.
The group managed to bring its debt to $3.5 billion after issuing public bonds and the sale of shares from the Time Dotcom Bhd.
The chairman of the group had also accumulated debts worth close to one billion dollars under the UEM. He owns 16.5% of shares in Renong Bhd and will certainly lose control of the company if the government takes over the company.
The possibility is that the Khazanah Nasional Bhd (Khazanah), a company run by the Ministry Of Finance, of which Mahathir is the actual minister, would take over the ailing Renong Berhad.
However, the Premier warned that if debts of the company were higher than its assets, the government would not venture into the purchase, but added that the government would not let any individuals hold such an amount of equity within companies the like of Renong.
|
