This article first appeared in The Edge Malaysia Weekly on August 11, 2025 - August 17, 2025

THE thrust of police investigations into the RM10 billion Penang World City project in Bayan Mutiara is said to be related to a hefty sum that Hemat Tuah Sdn Bhd forked out when it took over the project in 2018.

Sources say that when Hemat Tuah bought into the project in 2018, it had to pay a fee to the Penang Development Corporation (PDC).

“The crux of the police investigations is to determine Hemat Tuah’s source of funding and whether it is linked to the now-defunct MBI (Mobility Beyond Imagination). This is on account of links between the shareholders of Hemat Tuah and the founders of MBI,” says a source.

The Penang World City project, which is progressing at glacial speed, is under a private entity called Mutiara Metropolis Sdn Bhd (MMSB). Hemat Tuah wholly owns MMSB.

Police investigations stem from the association of some shareholders in Hemat Tuah to MBI’s founder Tedy Teow Wooi Huat, who is now detained in China for allegedly running a fraudulent get-rich-quick scheme between 2012 and 2018 in Penang.

MBI drew hundreds of millions in deposits from investors as far away as China, who were promised lucrative returns. The MBI scheme collapsed in Penang in 2018 but continued in Danok in Thailand for a few more years until Tedy was arrested in 2022.

A search with the Companies Commission of Malaysia (SSM) reveals that Hemat Tuah’s five shareholders are Koh Teck Ong, Lim Ah Chay, Lio Chee Yeong, Tan Kim Hee and Teow Wooi Pin. Wooi Pin is Tedy’s brother while Tan is said to be the latter’s brother-in-law. Wooi Pin has a 45% stake in Hemat Tuah while Tan owns 15%.

The link with Tedy’s family members led to the recent probe into whether Hemat Tuah or MMSB monies paid to the PDC were linked to MBI.

“Police are investigating a sum paid to PDC in 2018 or 2019 to obtain its consent for the transfer of the Penang World City project from its original owners,” says another source.

It is learnt that the fee was levied because of the change in the value of the land that was sold by the state government in 2011 and changed hands to Hemat Tuah in 2018.

The police have requested from PDC documents related to the sale.

During a recent press conference, Penang Chief Minister Chow Kon Yeow confirmed that the focus of the investigation, as conveyed to PDC, was to examine whether any of the funds paid to the state-owned development corporation by MMSB between 2011 and 2019 are connected to MBI.

In reply to questions from the media on whether the accounts related to the transaction were frozen, Chow’s reply was: “Ask the police. As far as I know, PDC is still operating as usual.”

Chow had also stated earlier this year that PDC had no direct dealings with MBI and that the state agency’s involvement in the Bayan Mutiara land sale followed standard procedures.

Hemat Tuah’s entry into the Penang World City development, which spans 102.56 acres, including 35 acres of land to be reclaimed, came after it acquired stakes from Ivory Properties Bhd (KL:IVORY) and Tropicana Bhd (KL:TROP) in 2018.

At that time, MBI’s wealth was evident from its involvement in the property sector, particularly in Penang and Kedah. Moreover, in Penang, MBI was closely related to Ivory Properties. Tedy and his family are investors in Ivory Properties’ iconic project — the Penang Times Square development.

The Penang World City development envisioned transforming Bayan Mutiara, located near the Penang Bridge, into a glittering RM10 billion urban hub. This colossal undertaking brought together property giants Ivory Properties and Tropicana through their joint venture (JV) company Tropicana Ivory Sdn Bhd.

The project’s genesis came about when Ivory Properties, riding high after its listing in 2010, won a privatisation bid floated by the PDC in 2011. The privatisation was for the development spanning 102.56 acres, including 35 acres of land to be reclaimed.

After winning the privatisation bid, Ivory Properties was touted as Penang’s largest developer as the project included high-rise residences, hotel towers, retail complexes and corporate offices centred around an open-air mall. The entire development was due to be completed in 2020.

The launch of Tropicana Bay Residences in 2013 marked the JV’s first major project, featuring eight residential towers and generating significant interest from buyers. Subsequent transactions saw property developer Asia Green Group acquire three development parcels, delivering two completed projects with a third in planning.

However, the project’s ambitious reclamation component — initially scheduled for 2014 — was mired in delays. Technical complications pushed the RM200 million earthworks to mid-2017, with completion expected to take three to five years.

By 2018, both Tropicana and Ivory Properties had sold their stakes in Tropicana Ivory to Hemat Tuah. Tropicana divested its 55% holding to Hemat Tuah for RM70.7 million, followed by Ivory Properties’ disposal of its 45% stake for RM56 million a few months later. Tropicana Ivory was renamed Mutiara Metropolis or MMSB.

According to the zoning approval, MMSB has plans to develop an integrated development with a 22.3 million sq ft gross build-up area. The plot ratio approved is 5:1, while the density is 87 units per acre. The reclamation cost is estimated to be about RM70 per sq ft.

Industry observers note that currently, there hasn’t been much progress on the reclamation works. 

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