Najib defends Felda’s investment in the Indonesian company.
Felda has lodged a police report, claiming that Datuk Seri Najib Razak cheated them into investing US$505mil (RM2.07bil) in Eagle High Plantations TBK (EHP), reported Free Malaysia Today.
Felda director-general Othman Omar made the report at the Dang Wangi police headquarters on Monday (April 8).
In the report, he said the amount paid to acquire a 37% stake in the Indonesian firm was 344% more than its actual value of US$114mil (RM466.9mil).
EHP is part of the Rajawali Group owned by tycoon Peter Sondakh, whom Othman claimed was close to Najib.
He also said that Felda took an RM4.8bil loan to finance the deal from GovCo Holdings Bhd (GovCo), a subsidiary of the Finance Ministry, which was then headed by the former prime minister.
“Following the purchase by Felda at RM2.3bil, it suffered losses when the value, as of last month, was just RM555mil,” Othman was quoted as saying.
He claimed Najib directed Felda in 2015 through its special purpose vehicle FIC Properties Sdn Bhd to invest in EHP.
Apparently, the bid to purchase EHP was offered to several agencies, including FGV Bhd, Malaysian Palm Oil Board (MPOB) and Malaysian Rubber Board (MRB) before subsequently being “forced” on Felda.
Othman said the deal was one-sided and risky, as EHP had debts of US$547.4mil (RM2.24bil) in 2014 and liabilities of US$676.9mil (RM2.8bil) in 2016.
He fingered former Felda chairperson Mohd Isa Samad, who signed the deal, his successor Shahrir Samad, as well as former second finance minister Johari Abdul Ghani and former deputy minister Razali Ibrahim as having played a role in the matter.
He reportedly further named seven individuals whom he alleged were involved in a criminal conspiracy, criminal breach of trust, possible graft, and money laundering, in the Felda transaction, and urged for a probe into it.
Othman’s police report comes as Putrajaya is to table a white paper on Felda in Parliament tomorrow, on plans to rescue the land scheme.
Felda is now looking to terminate the EHP deal with the Rajawali group and reclaim US$500 million.
Economic Affairs Minister Azmin Ali had said that the government will let the Felda management handle the matter.
Isa and other former top officials have been sued by Felda.
Othman also lodged a separate police report over the Kuala Lumpur Vertical City project which he claimed also caused losses to Felda where he suspected there are similar offences as stated above.
Meanwhile, Najib defended Felda’s investment in EHP, urging the government to make public the agreement signed between the two companies.
In a Facebook post, Najib said he had called on the government in early February to reveal that a “put option” was part of the agreement, yet Putrajaya remained silent.
He said the “put option” would allow Felda to sell back its 37% to EHP at the original purchase price plus the 6% annual interest charge borne by EHP.
“In other words, if we did not want to continue with the investment, we could claim all the money we paid plus 6% annual interest.
“The money we used to pay for the investment was borrowed through bonds with an interest rate of 3.85%,” he said.
Najib said this meant that if EHP succeeded and the price of palm oil recovered, the investment would bring in huge profits.
“On the other hand, the government would still profit if it sold back the shares because the interest we subjected EHP to was higher than the cost of our loan.”
At the end of the day, he said, public funds would still be ensured, and the government would not suffer any loss.
He said this disproved the claim that Felda would suffer losses by buying into EHP.