KINIBIZ So it is now confirmed: there are two “final, binding and fully funded” bids to buy a 60 percent stake in 1MDB’s Bandar Malaysia project, as announced by the company’s subsidiary 1MDB Real Estate on Nov 12.
But the elephant in the room now is why the company seeks to let go of a majority stake in the project, potentially to foreign entities, when there is every risk that such a transaction may turn out detrimental to national interests. Shouldn’t it retain at least majority control?
Of course, that 1MDB seeks to sell this stake is understandable if contentious. It is up to its neck in debt with RM42 billion in borrowings with insufficient cash flow to service its debt commitments, based on its annual accounts.
Selling off this stake is a quick way to raise cash, as is its proposed disposal of its power assets, though this latter disposal may be counter-productive as the power assets are its only real cash cow. (Read more on that here .)
However, there is much irony over the whole exercise considering what Bandar Malaysia originally set out to be.
On available information, Bandar Malaysia is a mammoth undertaking just under 4km away from the Petronas Twin Towers on the 486-acre site of the old Sungai Besi airport. Past reports placed its gross development value (GDV) as high as RM40 billion.
For the full story go to KINIBIZ .
This article was written by Khairie Hisyam.