Friday 24 May 2024
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KUALA LUMPUR (Nov 1): Businessman Tan Sri Halim Saad maintained allegations of being forced by Tun Dr Mahathir Mohamad and then minister Tan Sri Nor Mohamed Yakcop to sell his stake in Renong and UEM Bhd, hence causing a loss of property to him and constituting a breach of his rights.

Halim, in his reply to Dr Mahathir, Nor Mohamed and the government’s defence, alleged that Syarikat Danasaham Sdn Bhd, a wholly-owned subsidiary of Khazanah Nasional Bhd, had, on or around July 23, 2001, made a general offer for the entire shareholding of UEM.

“Syarikat Danaharta was the means by which the government affected the compulsory acquisition, which is the subject matter of this suit.

“The plaintiff [Halim] did not agree to the compulsory acquisition of his vested right and deprivation of his rights as a controlling shareholder of Renong. The claim is not caught by res judicata by reason of its prior suit [it filed in 2013]. Hence, the claim is not barred by any limitation period under the Limitation Act 1953 and Public Authorities Protect Act 1948.”

Res judicata is a Latin term meaning a matter had been adjudicated or decided earlier by the same parties, as Halim had brought a similar action in 2013 against Nor Mohamed and others and failed all the way to the Federal Court.

Halim also denied that the poor performance of the then Kuala Lumpur Stock Exchange (KLSE) in 1998 was attributable to the performance of Renong and UEM shares.

He claimed that contrary to the defendants' contention, Renong Group was one of the most successful Bumiputera-owned groups at the material time where it controlled or owned the top 30 companies on the KLSE.

“I deny that there was a causal link between the performance of Renong and the price of UEM shares, on the one hand, and the performance of the then KLSE leading to the compulsory acquisition. There is no quantitative basis for the defendants’ claim that the UEM/Renong Group of companies had caused the entire stock market to underperform.”

He further denied the government’s claim that Renong’s management had resulted in the decline of Renong Group’s market capitalisation between 1997 and 2000, and claimed that the decline in the company’s market capitalisation was in line with the overall decline due to the 1997 Asian Financial Crisis.

Halim alleged that the financial crisis and monetary policies like the pegging of the ringgit by Dr Mahathir, as prime minister then, had the effect of isolating Malaysia in particular from foreign investors.

He cited other measures, including restrictions on non-resident sellers of Malaysian securities, who were required to hold on to their ringgit proceeds for at least 12 months before being permitted to repatriate, as another reason, as well as the political instability due to the arrest and prosecution of then deputy prime minister Datuk Seri Anwar Ibrahim and the attack on the judiciary in 1988.

“It gave rise to an impression that the federal government was not concerned with the rule of law; there was interference by the government in the economy and the deployment of government-controlled public funds... [which] led to declining confidence in official policy,” he added.

PLUS, TIMEdotCom and Putra

Halim further alleged in the reply filed on Monday that during the Asian Financial Crisis, Malaysia fell into a deep recession where the gross domestic product (GDP) dropped 28.37% to US$72.2 billion (RM343.8 billion) in 1998 from US$100.8 billion in 1996.

The Corporate Debt Restructuring Committee (CDRC), Halim claimed, had indicated that the debt restructuring could be carried out without any financial support from the government, and it was confident that significant value could be extracted over the coming years from Renong’s asset portfolio which he had built that included Commerce Asset Holding Bhd (now CIMB Bank), Ho Hup Bhd, Kinta Kellas Bhd, Cement Industries Malaysia Bhd, Pharmaniaga Bhd, TIME Engineering Bhd, TIMEdotCom Bhd, ParkMay Bhd, Faber Bhd, Crest Petroleum Bhd, EPE Bhd and Intria Bhd.

He added Renong also owned 24,000 acres of Nusajaya land in Johor, in claiming that the entire UEM-Renong group of companies was highly valuable, with total assets far exceeding liabilities.

Under the CDRC’s proposed scheme, Halim said Renong’s debt would be ultimately resolved via the issuance of RM8.4 billion in bonds by PLUS Expressways Bhd in September 1999 which were given an A3 rating from RAM, and this rating was maintained in Nov 2001 with PLUS having a net cash flow of RM25 billion.

This, he added, showed that PLUS was not in financial distress.

Halim alleged Dr Mahathir and the government of having directly or indirectly caused adverse impact to Renong’s financial performance.

Halim added that in April 2000, Renong signed a heads of agreement with Singapore Telecommunications Ltd to acquire 14.5% stake in TIME and 20% stake in TIMEdotCom from Renong for a total sum of RM2.2 billion in what was to be known as the TIME-SingTel deal.

“However, I [the plaintiff] who was Renong chairman and CEO of TIME was instructed by Dr Mahathir to abort the sale. The TIME-SingTel Deal thus had to be called-off and both Renong and TIME were denied the additional cash that would have been due to them from the deal,” he added.

Another asset in Renong’s portfolio was the 100% shareholding in Putra LRT, where under the said concession agreement, the government was required to compensate Putra a sum of RM7 billion.

“However, Putra was subsequently liquidated in 2002 after Syarikat Danasaham, and the plaintiff (Halim) exited the UEM-Renong Group. The government’s obligation under the concession agreement was ultimately extinguished, thus denying the UEM-Renong Group a receivable of RM7 billion,” Halim said.

The businessman reiterated that the acquisition of his vested right to effect a general offer on the entire shareholding of UEM by himself or jointly with Renong, had deprived his right as a controlling shareholder of Renong through the compulsory acquisition and this violated his rights of property under Article 13.


Edited ByIsabelle Francis
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