Penang Chief Minister Lim Guan Eng has condemned as “very dangerous lies and slander” the allegation that the state government had rejected a profitable agreement involving Pulau Jerejak, an island off the Bayan Lepas coast, in 2013.

Lim said the allegation by state BN chief Teng Chang Yeow had “tarnished his image and questioned the integrity of his senior officer”, Penang Development Corporation (PDC) general manager Rosli Jaafar.

“This is a serious allegation because it seems to suggest that the proposal was made to PDC and Rosli rejected it, this certainly has tarnished his image,” a furious Lim told a press conference in Komtar today.

“If Rosli had done something not known by me or the Penang government, I will take action against him."

Earlier today, Teng said Lim as PDC chairperson rejected a 2013 deal between Tropical Island Resort Sdn Bhd (TIRSB) – which will redevelop 80 acres of Pulau Jerejak – and Ideal Property Development Sdn Bhd.

The deal would have seen the state agency retain its rights over the island and potentially gain RM220 million in profit, Teng had claimed in his statement.

Teng's allegation came after PDC announced it had sold its 49 percent stake in TIRSB to Q Islands, a subsidiary of Ideal Property - a move which the Penang Gerakan chief said had robbed Penangites of their right over Pulau Jerejak.

Before the sale, TIRSB was a joint venture between PDC (49 percent) and federal linked-UDA Holdings (51 percent).

Lim had earlier explained in detail that the development in Pulau Jerejak was a federal project and a losing venture before PDC decided to sell its stake.

'Show us proof'

In disputing Teng's claim of the 2013 deal, Lim today asked, “How can we reject a proposal that guarantees us RM220 million in profits?”

“If Rosli had done such wrong, he would either resign on his own or be sacked by me,” added the DAP secretary-general.

Accompanying Lim at the press conference was Rosli, who denied rejecting such an agreement.

Lim then demanded that Teng show proof of the said agreement, and that he or Rosli had rejected it.

“When did we reject such an agreement? If Teng can show proof, Rosli and I will be sacked,” said Lim.

He added that this was “not a marble game played by children”, nor was it a laughing matter.

“Come on, don’t be like that. This is supposed to be a RM450 million deal, so don’t simply question the integrity of my senior officer, he would not do such a thing," said Lim.

'Unable to conduct open tender'

Meanwhile, asked if he would initiate legal action against Teng, Lim replied, “I do not like to threaten people, let him reply first”.

Lim also clarified that his administration sold the PDC shares to Ideal Property without an open tender because they were not the majority shareholder.

“Any agreement must be made with the consent of the majority shareholder (UDA) as it is they who will decide,” said Lim.

He reminded the press conference that it was UDA that introduced Ideal Property to the Penang government, and it was also UDA that announced the private developer was its new joint venture partner.

Lim also took the opportunity to criticise Gerakan, noting that when the party was in government, it had sold the 80 acres of Pulau Jerejak land to TIRSB even before the land premium of RM12.95 million had been fully paid.

“There was proof that the state government had then incurred a loss of RM34.6 million when they sold the land,” he added.

In 2001, the market value for the land was RM47.6 million – information that Lim said he had gleaned from former Gerakan chairperson Dr Teng Hock Nam's statement on March 25, 2011.

“If you (Gerakan) don't agree with the market value, take action against Hock Nam,” Lim added.

Frustrations as minority shareholder

On the same note, Rosli admitted that there were “frustrations” when working with TIRSB as PDC was the minority shareholder.

“We were not able to overcome losses and that problem aggravated year after year.

“It was only natural that we voiced out our concerns; we had wanted to buy more stake in the company, so we could become the majority stake holder.

“But TIRSB was not agreeable to it and did not want to sell although the cost we offered was reasonable,” Rosli explained.

Rosli said PDC had urged TIRSB to take up measures to stop the company from bleeding.

“But the problem did not resolve until the recent deal was inked,” Rosli added.