Former Penang Malay Chamber of Commerce chairperson Abdul Rahman Maidin told the commercial division of the High Court in Kuala Lumpur today that he had to bear losses of RM40 million for the 7.101 million shares he purchased in Realmild (M) Sdn Bhd, which were said to belong to Umno.

Realmild owns  majority shares in conglomerate Malaysia Resources Corporation Bhd (MRCB), which once owned the gold mine media giant New Straits Times Press (M) Bhd (NSTP) and Sistem Televisyen Malaysia Bhd (which operates TV3, among others).

abdul rahman maidin Rahman ( left ), who was a director of Realmild when he purchased the stake in the company, is being sued for RM10 million by a former company stakeholder, Khalid Ahmad.

Also a former chairman of MRCB and former executive vice-chairman of NSTP, Rahman said sometime at the end of 2001, he was instructed by then Prime Minister Dr Mahathir Mohamad to transfer all the Realmild shares in his name to Syed Anwar Jamalullail, without any consideration, and that he resigned from the two companies on Jan 8, 2002.

“I was told that the Realmild shares belonged to Umno. I was extremely shocked as I never at any time knew that Umno was the true owner of the shares.”

“I undertook the acquisition of Realmild shares purely from a corporate and commercial standpoint. I raised funds for this exercise through my personal financial means, without any assistance from any political entity,” Rahman said in reply to questions from his lawyer Alex de Silva. Eugene Jayaraj Williams is also acting for Rahman.

Told that the shares belonged to Umno

Rahman said he informed Mahathir that he had paid RM40 million for the NONE purchase of the Realmild shares.

“He (Mahathir) told me there was no reason why I had to pay the money when the shares never belonged to the individuals concerned as they belonged to Umno. Therefore, he said, no payment will be made to me because the shares always belonged to Umno.”

“I also met Nor Mohamad Yaakob, (then economic adviser to Mahathir), and he subsequently confirmed that the shares were to be transferred out by me, without me receiving any consideration as the shares belonged to Umno,” he said.

Asked by Khalid's counsel Ahmad Fadzil Mohd Perdaus why he did not institute action against his client and three other Realmild directors, from whom he had purchased the stake, Rahman said he obviously had to believe the (then) prime minister.

“Furthermore, I did not want to do anything that would implicate the premier. That is why I did not want to proceed with any further action. I would rather take a loss,” he said.

Daim offered stake in Realmild

Recalling how he came to own the Realmild shares, Rahman said he was approached by the then Finance Minister, Daim Zainuddin, sometime in 1999.

Daim had asked him whether he was interested in taking charge of MRCB by undertaking and completing a management takeover.

“Daim knew me as chairman of the Penang Malay Chamber of Commerce. I expressed keen interest in taking up this challenge, and Daim told me he would leave the mechanics of taking control of MRCB to me.

“I readily accepted this opportunity as this was a major career advance. It was my understanding that this was a pure corporate exercise,” he said.

Rahman said he then purchased all the stakes in Realmild from Khalid, former Berita Harian Sdn Bhd group editor Ahmad Nazri Abdullah, NONE former New Straits Times Sdn Bhd group editor Abdul Kadir Jasin ( right ) and former NSTP director Mohd Noor Mutalib.

The four were at that time aligned with then Deputy Prime Minister Anwar Ibrahim, before Anwar fell out of favour with Mahathir in 1998, at the height of allegations of sodomy against him.

Rahman said he took steps for the takeover of MRCB by raising funds through personal financial means.

He had paid RM30 million for Ahmad Nazri's stake, and another RM5 million each to Khalid and Mohd Noor.

Ahmad Nazri, a former director of Realmild, told an earlier hearing that he owned an 80 percent stake in Realmild, with 70 percent of it held in trust.

“I was holding (the stake) in trust for Dr Mahathir. The trust was prepared by legal firm Amin & Co. A copy of the the trust was given to Dr Mahathir, another to Anwar and I kept a copy.”

Rahman: I did not pay the remainder

Rahman, also testified before Justice Mary Lim that he did not pay the remaining amount to Khalid as he had been told by Mahathir not to make any payment.

“I met the plaintiff (Khalid) and informed him of my discovery about Umno's ownership of the Realmild shares. The plaintiff admitted to me that he was aware of Umno's ownership of the Realmild shares, but he said the Umno ownership did not apply to his five percent stake, or 355,050 shares.”

Saying Khalid was not entitled to the claim, Rahman said the Khalid had misrepresented to him the ownership of the 355,050 shares as these shares never belonged to Khalid.

“I verily believe that he (Khalid) knew all along that Umno was the real owner of the shares and that these shares could be directed to be transferred to any third party at any time. based on the instructions of Umno leaders. This also demonstrated the wrongful actions of Khalid in suppressing material information and proceeding in this action against me,” he said.

“I am also seeking recovery of the RM5 million I had paid Khalid, based on his misrepresentation as to the ownership of the shares,” he said.

 

To another question from Khalid's lawyer, Rahman said he was unable to pay the balance (the remaining RM10 million) because he was concentrating on reviving MRCB, which was facing billions of ringgit in debt.

“MRCB owed (money) to over 30 banks and it was in a bad shape. That was the reason I did not have money to pay him (Khalid).

“I also do not agree that I owe Khalid RM10 million, as stated in the statement of claim, and do not agree that the purchase price of his portion of the shares was RM15 million,” he said.

Khalid's suit

Khalid, a former director of Realmild and former managing director of NSTP, who was present in court today, had claimed that he owns five per cent of the Realmild shares and he had accepted Rahman's offer to buy his shares.

He said Rahman had paid RM5 million, and that both sides had agreed to the total selling price of the shares at RM15 million, which had been reduced from an initial value of RM30 million.

Khalid claimed that the price of RM15 million was agreed upon after the part payment of RM5 million was made by Rahman, and that the remaining sum was to be paid within a year.

He said he had asked Rahman many times to pay up the remaining RM10 million, but Rahman had failed to do so.

He is seeking the RM10 million , interest at eight per cent, costs and other relief deemed fit by the court.

Rahman in his statement of defence claimed the shares were owned in trust Umno and that he was asked to relinquish all his stake in Realmild to Syed Anwar.

Hence, he said, the amount owed was void or a mistake of fact, and was therefore seeking back the RM5 million he had paid to Khalid, as he had suffered a loss.

Earlier, Syed Anwar testified for Rahman and said got to know from Nor (Mohamad Yaakob), who was then second finance minister, that Rahman's shares in Realmild were held in proxy by Umno.

“My major task when taking over Realmild and MRCB was to turn them around,” he said.

Justice Lim fixed Oct 4 for submissions.