Another Call For Debate, This Time On Talam

PETALING JAYA: The debate syndrome among politicians has not abated. This time an opposition MP is asking for a debate on the Talam “exposes”.

PJ Utara MP Tony Pua has challenged Agriculture and Agro Industries Deputy Minister Chua Tee Yong for a debate to settle the Talam issue once and for all.

“I call upon Chua to end his misery once and for all, with a public and open debate in any language, at a time and place of his choosing, even if it is held at Wisma MCA over the “Talam Debt Recovery: A Billion Ringgit Bailout or a Billion Ringgit Mega-Blunder”.

“Chua has become an embarrassment for the MCA as he stumbles from one mega-blunder to another,” said Pua who is also DAP publicity chief .

Chua who is also MCA’s Young Professional Bureau chief yesterday claimed that the Selangor government had put its state government linked company Permodalan Negeri Selangor Berhad (PNSB) in a state of debt in its bid to save Talam Corporation.

Last week Chua claimed that Selangor had possibly misused public funds to bail out Talam via the RM392 million supplementary budget.

He added Selangor also bought an additional RM676 million worth of assets from Talam.

On the same day, Selangor Menteri Besar Khalid Ibrahim responded, saying that his administration would table a white paper during the tabling of the state budget.

On July 4, Khalid upped the ante by announcing that Selangor would sue MCA over the allegation.

The following day, Chua alleged that Pakatan-ruled Selangor over-paid Talam by RM42 million for a land in Bestari Jaya.

On Saturday, Pua provided a detailed presentation and explained that Selangor had actually underpaid Talam by RM9.1 million.

Chua said yesterday that in 2010, the state government sold RM450 million worth of assets it purchased to PNSB.

“The state sold plots of land in Bukit Beruntung 2 and Bestari Jaya, bought from Talam, to PNSB for RM450 million,” he said.

PNSB, Chua added, was a debt-free company in 2009 and had RM76 million in cash balance and fixed deposits.

“Based on a letter to the Registrar of Companies in May 2011, PNSB appears to have pledged a lot of its assets to borrow RM230 million from Maybank, where the interest itself is worth RM86 million,” he said, claiming that the loan was used to purchase the plots of land from the state government.

Illogical

Pua brushed aside Chua’s claims since it was illogical for PNSB to borrow RM230 million in order to recover RM22 million.

“Chua himself admitted that he was not able to ascertain that PNSB had taken the hefty loan to purchase the plots of land in the Hulu Selangor constituency as the state firm’s 2011 audited accounts are not yet available.

“He is really just shooting in the dark,” said Pua.

Pua further added that even if a loan of that amount was taken, there are no case of impropriety to acquire RM450 million worth of land assets since the accounts are audited, valued and recognized in the PNSB 2010 financial accounts.

He explained that PNSB operates as a property development company the acquisition of land for future potential development is the normal course of business for a property development company and being in debt is not a course to financial scandal.

“As a trained accountant, Chua should know that getting into debt is not in itself an adverse event for the company.

“Otherwise, Malaysia’s largest property developers SP Setia Bhd, Sunway Bhd or IOI Corporation Bhd must be among the worst run companies because they carry debts of RM2.44 billion, RM2.42 billion and RM5.46 billion respectively in their books.

“What is important is whether the liabilities that a company undertakes are sufficiently backed by its assets, and whether these assets can generate higher returns than the cost of funds.

“In this particular case, it is clear that the RM450 million of additional assets as pointed out by Chua himself, is worth nearly double that of the debt.  So what’s the problem?” Pua said. -FMT

Talam Corp