The financial details of ailing Sarawak state-owned wafer foundry 1st Silicon Sdn Bhd up to the time of its proposed merger with a foreign firm must be made public, said Bandar Kuching MP Chong Chieng Jen.

Details of the merger with Germany's X-Fab Semiconductor Foundries AG to form a new entity called Xfab Silicon Foundries NV, should also be disclosed.

According to Deputy Chief Minister Dr George Chan, the German firm would be entitled to a bigger share. Other details, however, remain a mystery.

The state government which owns a 96 percent stake in the Kuching-based foundry has spent up to RM4 billion on the project. Since 2000, losses has ran up to about RM2.5 billion.

Fringe benefits included?

Based on his research, Chong alleged that the company spent between RM3 to RM4 to produce every RM1 in sales, a claim which has yet to be refuted.

A check at the Commission of Companies also revealed that the company had been selling of its assets, allegedly to relieve the company from its expensive loans.

"I don't believe anyone would want to step into an ailing company without any inducement or fringe benefits whatsoever," said Chong adding that possible benefits include interest-free loans and guaranteed profits from operations.

Described as the most expensive investment by the state government so far, observers have noted that the merger would be a better alternative than the prospect of having the government being forced to shut down the company's operations.