This is the second part our series on the MRCB-Nusa Gapurna takeover, which began yesterday.

Question and answer session

Mohamad Salim Fateh Din is the man of the hour. His proposed deal - where his 60 percent unit Nusa Gapurna Developments Sdn Bhd, Gelanggang Harapan Sdn Bhd and a few other companies of his - are being taken over by Malaysian Resources Corp Bhd (MRCB) for RM729 million has raised quite a few eyebrows.

The share and cash deal will see Salim control 16.8 percent of MRCB, and emerge as the second largest shareholder in MRCB, after the EPF. He will also become managing director of MRCB, a post which has been vacant since August last year.

Hitherto it was a position held by professionals - Mohamed Razeek Hussain from December 2009 to August last year. Before him it was Shahril Ridza Ridzuan, who is still a MRCB board member and currently chief investment officer of Employees Provident Fund which is a major shareholder of MRCB with a stake of 42.2 percent.

Salim answers questions on the valuation of the various parcels of land, how he managed to get them, his political linkages and his role at MRCB. In an interview with Kinibiz , Salim was frank and did not pull his punches.

Q. You say Ernst & Young valued Gelanggang Harapan at RM310 million to RM350 million, yet you sold it for RM250 million to MRCB?

We had a lot of arguments, this (Gelanggang Harapan sale) alone was a one month argument (between him and MRCB), we gave in because we are looking at a long term perspective.

Once the whole merger is done we will all benefit, so we didn't want to argue on the RM100 million. Also the valuation was done on a DCF (discounted cash flow) valuation method, which is the most prudent method.

But yes, I would like to put it on record that we gave a RM100 million discount - also Ernst & Young is MRCB's consultant, not ours.

Q. Does Gelanggang Harapan have any contracts outside of the Gapurna group?

We build all the Giant Hypermarkets and for a few other parties such as Shell and Petronas where we build infrastructure for them.

Q. Why 16.8 percent?

EPF still wants majority, and wants about 40 percent. (EPF will end up with about 38.4 percent)

Q. Isn't it risky for you only having 16.8 percent?

I don't call it a risk, I call it a challenge ... Whatever you do EPF will always be the largest shareholder, they have a huge block, so we can only be the second largest shareholder ... but we are doing business in good faith, there will be challenges but we are doing the deal in good faith.

Anyway in a lot of the companies, the smaller shareholder drives the business, it's not exactly something new ... If we keep performing there is no reason for anyone to get rid of us.

Go to KiniBiz for more .