This article first appeared in The Edge Malaysia Weekly on February 23, 2026 - March 1, 2026

LAST week, IJM Corp Bhd (KL:IJM) lost an opportunity to bid for a job to build a multibillion-ringgit data centre for an international client.

According to sources, the client suggested that the company not bid for the job as it would not be considered because the Malaysian Anti-Corruption Commission (MACC) is conducting an investigation into the construction firm.

It is learnt that until IJM gets a clean bill of health from the MACC with regard to allegations of money laundering, its ability to submit tenders for new jobs is limited.

“The international client also told IJM that the company’s ongoing takeover exercise also puts it in a position of disadvantage,” says a source.

This development merely confirms the concerns of the major shareholders of IJM, who are ultimately accountable to the Ministry of Finance (MoF), about the construction giant losing its brand value following a takeover and an MACC investigation.

The Employees Provident Fund (EPF) is the single largest shareholder of IJM with a 20.5% stake while Permodalan Nasional Bhd (PNB) is the second largest shareholder with about 13%. Retirement Fund Inc (KWAP) has 9.6% equity interest in the company while Lembaga Tabung Haji together with Urusharta Jemaah has 4.3%.

On Jan 12, Sunway Group Bhd (KL:SUNWAY) launched a takeover of IJM at RM3.15 per share. The cash offer is only for 10% of the value while the remaining 90% is in the form of Sunway shares. Sunway’s offer for IJM did not go down well with some bumiputera groups.

A week later, the MACC launched an investigation into IJM for alleged money laundering and its non-exective chairman Tan Sri Krishnan Tan Boon Seng was called in for questioning.

According to sources, these events are a cause for concern for the MoF.

Two weeks ago, a top MoF official held a meeting with the heads of investment of the EPF, KWAP, PNB and Urusharta Jemaah. The agenda was to discuss their position on the proposed takeover offer from Sunway Group.

It is learnt that the MoF stepped in to coordinate the response of the funds to Sunway’s offer and preserve the value of IJM as a major construction and infrastructure powerhouse amid the takeover. It is said Putrajaya wants to ensure that the funds work together to extract the best value from IJM.

“They particularly do not want PNB and EPF to vote differently on the Sunway deal. If these two funds vote differently, the maximum value cannot be derived from their interest in IJM,” says a source.

Even before Sunway’s proposed offer of RM3.15 per share for IJM emerged, there was speculation in the market that PNB wanted to exit the construction giant as part of its ongoing exercise to get out of infrastructure investments and allocate its cash resources to other areas instead.

The EPF’s stance on IJM is different from PNB’s. It has always wanted a merger between IJM and Malaysian Resources Corp Bhd (KL:MRCB). The EPF is the single largest shareholder of both these companies for which construction and infrastructure is the mainstay.

The EPF also has a 40% stake in the DUKE Highway, which it is supposed to exit via a listing. But it has been unable to do so thus far.

“The EPF has always viewed IJM as the best possible candidate under which to consolidate all its infrastructure interests because of the company’s management and execution track record. In the past, the EPF had attempted to broach the subject of consolidation with IJM but was unsuccessful.

“The EPF did not want to force through any proposal for fear of losing the management. Apart from the assets, the value in IJM is its management,” says a source.

It is learnt that the EPF is cognisant of what happened in PNB’s takeover of S P Setia Bhd (KL:SPSETIA) in 2011. Following the takeover, the S P Setia management, led by Tan Sri Liew Kee Sin, left the property developer and set up their own.

Because of the many issues in play with regard to the takeover of IJM, the MoF has entered the picture to coordinate the response of the government funds and, at the same time, try to chart the future of IJM. 

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