MCA leaders are today bitterly divided on the takeover of Nanyang Press with party president Dr Ling Liong Sik saying it was done in accordance to the party constitution while his opponents maintain otherwise.

After an emergency central committee (CC) meeting this afternoon, Ling told a press conference that the majority of the committee members had agreed that the opposing faction's argument was invalid.

"In accordance with Article 174, it is resolved that the Nanyang takeover does not fall within the interpretation of Article 150," said Ling.

The leaders opposing the takeover, led by deputy party chief Lim Ah Lek and vice-president Chua Jui Meng, have claimed that the purchase was unlawful as the party's properties were used as collaterals for a bank loan before the CC was consulted.

This, the opposing faction said, had infringed Article 150 which requires the party to obtain the CC's approval prior to mortgaging its properties for such loans.

While, Article 174 states that if there is dispute in interpreting the party constitution, the CC will determine the meaning of any particular article. This decision by the CC shall be final, conclusive and cannot be questioned in a court of law.

Ling said that 32 out of the 40 CC members had agreed that Article 150 is not applicable to the Nanyang takeover.

"The CC is the final interpreter of our constitution. The decision reached is final and cannot be taken to any court," he stressed.

Strong objections

Last month, Hong Leong group owner Quek Leng Chan sold Nanyang Press, publisher of dailies Nanyang Siang Pau and China Press , to MCA investment arm Huaren Holdings for RM230 million cash.

Huaren's shares in Star Publications - which publishes leading English daily The Star - and the newly acquired Nanyang Press, were used as bank collateral to obtain a 100 percent loan for the purchase.

However, the controversial deal had generated strong objections from various quarters who feel that the dailies' independence would be compromised if fallen into the hands of a political party.

Eight MCA top-level leaders who are also CC members had also raised their objection towards the deal.

Ling said that tomorrow's extraordinary general meeting (EGM) - to be attended by 2,385 party delegates - will clear the dispute over the Nanyang takeover, adding that he has no hard feelings against the eight who disagreed with him on the matter.

He also said that Huaren has received three offer proposals to buy a strategic stake in Nanyang Press, including one from the Chinese consortium led by prominent businessman Lim Guan Teik.

However, Ling did not divulge the identities of the other two potential investors who are eyeing a stake in Nanyang.

"Huaren board is studying all the proposals now. They are the experts," explained the president.

'Trying to gag'

Disagreeing with Ling, party vice-president Chua said the loan was obtained by MCA despite Ling's claim that the bank collateral - Star Publications shares - were owned by Huaren and not the party.