Monday 22 Jul 2024
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This article first appeared in The Edge Malaysia Weekly on October 9, 2023 - October 15, 2023

Responding to a query from Bursa Malaysia regarding its deal to acquire 559 acres of land from the Penang Development Corporation (PDC) to build an industrial park in Batu Kawan, Sunway Bhd has revealed three interesting facts.

First, it subscribed for new shares issued by Umech Land Sdn Bhd — which gave it a 70% stake — on Sept 25, 2023, which was just two days before Umech Land signed an agreement with PDC per its announcement.

Second, Sunway paid RM23.3 million for the stake, and the money was used by Umech Land to pay a deposit of 

RM64.6 million to PDC. After this payment, Umech Land was left with a cash balance of only RM130,848.89.

Third, Umech Construction Sdn Bhd is not related to Sunway — which means Umech Construction is also not related to Umech Land.

The question is, why did PDC end up signing an agreement with Umech Land on Sept 27 when the negotiations all the while were with Umech Construction as Penang Chief Minister Chow Kon Yeow himself said.

This is also supported by documents showing that the negotiations were between Umech Construction and PDC.

Umech Land and Umech Construction are legally unrelated entities although they share the same name and shareholders.

Furthermore, as revealed to Bursa, Umech Land has weak financials. If the thinking is that Sunway can provide the financial power and expertise, why not sign directly with it instead of this convoluted route of negotiating with and getting the proposal from Umech Construction, and then signing with Umech Land, but in the end, the land deal is really with Sunway?

Convoluted and intriguing. Perhaps not all the facts have been made known yet.

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