How should we judge a government?

In Malaysia, if you don't watch television or read newspapers, you are uninformed; but if you do, you are misinformed!

"If you're not careful, the newspapers will have you hating the people who are being oppressed, and loving the people who are doing the oppressing." - Malcolm X

Never argue with stupid people, they will drag you down to their level and then beat you with experience - Mark Twain

Why we should be against censorship in a court of law: Publicity is the very soul of justice … it keeps the judge himself, while trying, under trial. - Jeremy Bentham

"Our government is like a baby's alimentary canal, with a happy appetite at one end and no
responsibility at the other. " - Ronald Reagan

Government fed by the people

Government fed by the people

Career options

Career options
I suggest government... because nobody has ever been caught.

Corruption so prevalent it affects English language?

Corruption so prevalent it affects English language?
Corruption is so prevalent it affects English language?

When there's too much dirt...

When there's too much dirt...
We need better tools... to cover up mega corruptions.

Prevent bullying now!

Prevent bullying now!
If you're not going to speak up, how is the world supposed to know you exist? “Orang boleh pandai setinggi langit, tapi selama ia tidak menulis, ia akan hilang di dalam masyarakat dan dari sejarah.” - Ananta Prameodya Toer (Your intellect may soar to the sky but if you do not write, you will be lost from society and to history.)

Thursday, July 05, 2012

Talam bailout was honourable, wasn't it, Tee Yong?

Dr. Dzulkefly Ahmad explains by revisiting an earlier article published in April 2010...

'Round-tripping' procedure

Talam's debt recovery exercise revisited

Gist of it:

"To recapitulate, Maxisegar Sdn Bhd (MSSB) in 2001, a wholly-owned subsidiary of Talam Corporation Berhad, entered into a contract with the State Government of Selangor to finance and construct the Main Campus of UNISEL on 572.16 acres of land at Berjuntai Bestari, Selangor for a total development cost of RM750 million.

In consideration of the cost incurred, the State Government of Selangor had alienated three parcels of leasehold land to MSSB as in Batang Berjuntai (3000 acres valued at RM345million), Taman Puncak Jalil (801 acres valued at RM337.5million) and Suajana Damansara (110 acres valued at RM67.5 million).

MSSB defaulted in the final delivery of the UNISEL project. In its 2009 annual report, Talam said it had been unable to meet its financial obligation to bear the development and maintenance costs of about RM134 million in the Universiti Industri Selangor (Unisel) project.

Meanwhile Talam Corp Bhd couldn’t also deliver and fulfil its financial obligation in several real estate joint-venture development projects with the above-mentioned state subsidiaries. All these debts however only came to be noticed and uncovered by auditors appointed by the Pakatan’s State Government of Selangor.

The debts were in most cases previously neither fully recognised nor well recorded in the books of the state subsidiaries as the creditor. That is at best irresponsible and scandalous at worst. The previous state government and the state subsidiaries concerned must be put to task accordingly.

To make matter worse for the State Government, Talam Corp Bhd has been classified as an affected company under PN17 since Sept 1, 2006, for failing to pay off its outstanding loans and bond obligations while its auditors were unable to provide an opinion on its results for its FY2006 ended Jan 31.

Talam’s executive director, Chua Kim Lan said Talam was targeting to complete its regularisation plan by May this year, for the company to have its Practice Note 17 status removed. Chua said after completing the regularisation plan, the debt level of Talam will be reduced from RM3 billion to RM300 million.

Talam is looking at disposing of about 3,000 acres (1,214ha) of land from its current landbank of 7,000 acres. The largest tract of land to be disposed of would come from the company’s Bandar Bukit Beruntung development.   Talam’s current projects alone and in joint-venture with others, like IJM Corp Bhd etc, have a combined gross development value of more than RM1.4 billion as claimed by the Executive Director.

Talam has considerable land-bank for development in prime areas in the Klang Valley such as Ampang, Sepang, Puchong, Bukit Jalil and Rawang.

According to Bloomberg data, the net tangible asset (NTA) per share for Talam is 18 sen, while the share was trading at 9.5 sen last Thursday [April 15, 2010 - Ed.]. Talam’s landbank, according to its 2009 annual report, amounted to 5,792 acres as at Jan 31, 2009. The value on the books came up to RM1.13 billion, including development costs.

In other words, the state government runs a risk of writing off these as bad debts if no proper action is taken.

The overarching objective of the debt recovery exercise is for the state government to take over the ‘ownership’ of the debt, as it is in a better position to secure the receivables. The rationale is to ensure that Talam Corp Bhd gives a higher priority to its debt (to the state), incurred over the last decade, ahead of its other creditors. “Previously, we (the state) were at the lower rung of creditors, now we want to be at the top rung,” quipped the Mentri Besar.

In a smart maneuver of what is known as ‘round-tripping’ in the financial discipline, the state government has now taken over the debt from the state subsidiaries and currently in a better position to squeeze Talam directly as to fulfill its debt obligation."


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