KUALA LUMPUR: A year after Padiberas Nasional Bhd (Bernas) — a company mandated to manage the country’s rice supplies until 2021 — was privatised by Tradewinds Sdn Bhd, which is controlled by tycoon Tan Sri Syed Mokhtar Al-Bukhary, the government has yet to get any updates on the company’s restructuring exercise or its relisting plans.

“Their promise to me [is] they are going to restructure and then they are going to apply for IPO (initial public offering),” Agriculture and Agro-based Minister Datuk Seri Ismail Sabri Yaakob told The Edge Financial Daily at the Parliament lobby early this month.

On whether Bernas had indicated any time frame for its relisting since it was taken private and delisted in April last year, the minister affirmed: “No, [they are] still restructuring.”

In November 2013, Ismail Sabri had given the assurance that the delisting of Bernas, which was criticised by many parties, would only be temporary. He said Bernas had given him a written pledge that the delisting was only until the company completed its restructuring. In March last year, Ismail again referred to the written pledge and said that Syed Mokhtar’s companies intended to relist Bernas after five years.

Now, however, not only is Ismail Sabri saying that the company has not given him any time frame to relist, he also said the corporate exercise is not of the government’s concern as long as Bernas fulfils its obligations under its concession agreement.

Under its concession agreement with the government, Bernas’ obligations include maintenance of the nation’s rice stockpile, acting as the buyer of last resort for padi farmers, managing the bumiputera rice millers scheme and the distribution of padi price subsidies to farmers on behalf of the government. The concession was extended to 2021 in 2011.

“Our concern is not the company. Our concern is the treatment of farmers. The corporate exercise is just a private exercise; they have fulfilled all the promises, and so the agreement stands. Although they are not a ‘berhad’ (limited company) now, the agreement still stands,” he stressed.

On whether the ministry is satisfied with Bernas’ performance so far, Ismail Sabri said, “Until today, to say that we are 100% satisfied ... of course, there are still problems here and there. [But] as a whole, I think they are okay.”

Bernas, formerly known as Lembaga Padi dan Beras Negara (LPN), was corporatised in 1994 and subsequently went public. It is the country’s sole importer of rice and controls about 30% of the national rice supply. Currently, the country’s self-sufficiency level stands at about 70%. The company was formerly owned by a consortium of companies, which included stakeholders such as farmers and fishermen so that the groups could have a say in the management of the company.

A conditional takeover was made to Bernas by joint offerors linked to Syed Mokhtar in 2013. However, the group did not make any commitment to relist the company then, apart from Ismail Sabri’s assurance.

He also said then that Bernas had promised to offer 5% shares each to stakeholders like the National Farmers Organisation and National Fishermen’s Association when it re-lists — which Bernas later denied. At the time, Nafas held a 4.7% stake in the company while Nekmat had 4.3%.

Critics had previously voiced concerns that the privatisation of Bernas would effectively remove the company from public scrutiny.

In its latest statement for financial year ended Dec 31, 2013 (FY13) that was filed with the Companies Commission of Malaysia on June 26, 2014, Bernas recorded a profit of RM 156.61 million with revenue of RM3.7 billion.

Non-current and current assets stood at RM931.26 million and RM2.21 billion respectively, while its non-current and current liabilities were at RM522.24 million and RM1.28 billion in FY13.

The company’s revenue, mainly generated from the rice sector, accounted for about 80% of its total revenue in FY13.

Besides monopolising rice imports, Bernas also benefits from the rice miller subsidy given by the government for producing the Super Tempatan 15% (ST15; 15% broken rice) for the lower-income group.

In a written reply to Beruas Member of Parliament Ngeh Koo Ham on April 8, Ismail Sabri said the government paid a total of RM528 million subsidy last year to Bernas for milling the ST15 rice.

This article first appeared in The Edge Financial Daily, on April 21, 2015.