new I read with grave concern the report on the privatisation or takeover of the Sarawak Electricity Supply Corporation (Sesco) by a public-listed Sarawak Enterprise Corporation Bhd (SECB).
I wish to express my views as with regards to below.
1) Lack of transparency: The public, in general, are still not aware of the full details and implications of the Sesco (Successor Company) Bill 2004 (for the takeover) as it was never made public by the state government.
It was reported one month ago that an MoU had been signed for the proposed takeover of Sesco by SECB but the contents of the MoU has never been made public.
2) Why the rush to pass the bill? All of a sudden, we realise the Sarawak state legislative assembly is going to read and pass the bill this week. An issue of such mammoth importance should be made transparent to the people of Sarawak.
I certainly urge the press to publish in full all relevant information on the proposed takeover as soon as possible for the people to know its implications.
3) Sesco must fulfil its social obligations as a statutory body. It is owned by the people of Sarawak and entrusted to the state government to be supervised under the state legislative assembly.
It has the social responsibility of providing electricity to the people of Sarawak and it is still until today the sole electricity provider for Sarawak. The people of Sarawak have been paying their utility bills faithfully and hence have contributed to Sesco's huge profit year after year.
Sesco must perform its social obligation and not be just driven by huge profits.
4) SECB's management record and expertise: Sesco is the last of the cash cows in Sarawak so no wonder there are so many 'investors' interested in it. In fact, even before the MoU was announced, the share price of SECB went up from 90 sen to its peak at RM1.40 over a matter of a few days.
By such manipulation, or should I say, market forces, the shares of SECB are now worth much more than before the announcement and it is definitely a bargain for SECB to issue new shares to swap away Sesco's RM4 billion worth of assets (contributed by the people of Sarawak). And what will happen to the ownership of SECB after it has acquired Sesco 100 percent.
Furthermore, let's look at the management track record of SECB according to its 2003 annual report. It invested in a RM104 million in office tower in Johor Baru which up till now is still half vacant.
What has SECB - which is supposed to distinguish itself as a specialist power generation company got to do with property investment? And why on earth in Johor Baru? What has it got to do with utility businesses in Sarawak, which have actually contributed to all of SECB's profits through Sesco operations?
The logic that SECB will be able to manage Sesco more prudently or better than present with the takeover is doubtful.
5) Sesco belongs to the people of Sarawak. If the Sarawak government wants to privatise Sesco to bring benefits to the people, they should look around the region for a corporate restructuring model which can really benefit the people.
Let's just look at an example from Singapore - SingTel. In October 1993, SingTel - a Singapore government-controlled monopoly telecom provider - went public. The IPO represented a 11 percent share of the company, with the remaining held by Temasek Holdings, the investment arm of the Singapore government.
The public offer was broken into three tranches - A, B and C. Singapore citizens were able to purchase A shares at a special discounted price, an effort by the Singapore government to share the nation's wealth and enlarge the base of citizen-share owners in the company.
Singtel now has more than one million Singaporeans as their retail shareholders and they have all benefitted from the profits after the company went regional.
What is the Sarawak government doing with regards to the interests of Sarawakians in the takeover of Sesco?
Where are the shares for the Sarawakians who have been faithfully paying their Sesco bills year after year, month after month since independence? Are we not too the rightful owners of Sesco?
I would like to ask our dear people's representatives at the Sarawak state assembly sitting to consider seriously the implication of repealing the Sesco Act 1962. They should in this matter demand safeguards for the interests of all Sarawakians.
The people of Sarawak, after having faithfully paid their electricity bills for so many years, are rightfully the shareholders of Sesco in the privatisation exercise and shouldn't they enjoy its wealth, too?
