DAP parliamentarian Tony Pua demanded the government's investment arm Khazanah Nasional to explain the disposal of its shares in many government linked companies (GLCs).

The Petaling Jaya Utara MP in a press conference in Parliament today stated that Khazanah has been aggressively selling off its stakes in GLCs and its latest disposal was the sale of Tenaga Nasional Berhad (TNB) 86.75 million shares.

Each share was priced at RM8.10 each amounting to RM703 million for Khazanah.

cpps mid term review forum 240408 tony pua Pua asked if the sales were to raise money for the government's mega-projects which is heavily dependent on foreign investment.

He also asked is the funds will be channelled back into the government's coffers to plug budget deficits, and as additional funds to top up declining petroleum revenues.

"It may possibly appear that the government is so short of funds, that it is not only raising various new taxes, but also selling its stakes in GLCs to raise funding.

"Will Khazanah utilise its additional funds to top up investments in its biggest project, Iskandar Malaysia, which is facing shortfalls in investments due to its over-independence on Middle-Eastern funds such as Dubai World and Damac Properties?

"In addition, is Khazanah selling the GLC stocks because it needs the money to complete the required infrastructure for the land which has been sold to foreign investors as rumoured in financial circles?" asked Pua.

According to Pua, in October and November, Khazanah sold approximately RM95.6 million shares of PLUS Expressways Berhad, raising more than RM310 million.

Prior to that, in September, Khazanah sold 5 percent of Malaysia Airport Berhad.

Pua sceptical about sale of shares

"Khazanah sold these shares on the pretext that they are intended to increase the free float and liquidity of the Malaysian stock market. It has been suggested that this would enhance the participation of foreign institutional investors," said Pua.

He was, however, sceptical if the sales were made with the sole purpose of increasing the free float and liquidity of the Malaysian stock exchange.

"In reality what has actually taken place is the TNB shares which were previously held with Khazanah, are now held by another government-related institution, the EPF.

"The only difference is EPF, which is funded by Malaysian workers, paid RM405 million for these shares to the government of Malaysia. The EPF has also been a net buyer of PLUS shares.

"As a result, it is critical for Khazanah to be transparent with the public as to the full rationale for these sales and what will Khazanah do with the billions which will be raised from these sales," he said

He added that the government's plan to have a US dollar exchangeable Islamic bonds (Sukuk) shows that Khazanah's intent is not entirely reduce the stakes to improve liquidity of the local stock market but to actually raise funds.

"Khazanah must therefore fully explain the above questions to ensure that public funds are not abused and more importantly, good money will not be used to chase after bad. Otherwise, not only will Khazanah be reduced to managing RM20 million heritage sites, it will also lose the trust of the Malaysian population," he said.