Feb 14 2007
Don’t you disturbed when you read that a government is venturing into business instead of focusing in politic – the area which they were elected by the voters to perform? That’s the headline from Business Times when it carry the report that Umno Set To Surface In PECD. According to the report, the major component of Malaysia ruling party, United Malays National Organization (UMNO), is set to emerge as a substantial shareholder in construction firm PECD Berhad (KLSE: PECD, stock-code 5093). Now you know why PECD stock jumps more than 130% in trading today. The last stock price transaction was at 75 cents, up 42.5 cents from closing of 32.5 cents yesterday.
UMNO will buy 25 per cent of PECD, a loss-making firm with a RM1.4 billion order book, a move that could help the company settle its disputes with government-related bodies. The existing major shareholders of PECD include Tan Sri Mohd Razali Abdul Rahman, Nik Sufian Mohd Zain and Datuk Othman Hashim with a collective 32.18 per cent, its 2005 annual report showed. Peremba PJ Holdings Sdn Bhd also holds another 26.11 per cent.PECD swung to a third-quarter net loss of RM34.4 million as at September 30 2006 versus a net profit of RM6.3 million in the same period a year earlier. The loss was due mainly to slow progress of works from ongoing projects, reversal of profits recognized from certain completed projects and non-recognition of profits from its Sudan marine terminal project.
It was reported that UMNO is supporting PECD’s effort to resolve differences with state oil and gas firm Petroliam Nasional Bhd (Petronas) and state-owned property developer Putrajaya Holdings (PJH). PECD is claiming some US$200 million (RM700 million) in cost overruns for a project to build a marine terminal in Sudan. The project, to build oil storage tanks and fuel tanks among others, was awarded by a group of oil companies led by Petronas.PECD is also claiming RM178 million from PJH after the latter issued a termination notice for PECD to stop work on a government quarters project in Putrajaya.
It seems Malaysia government is one of the most flexible entities in the world looking at current situation. Besides crossing border from Executive to Legislative and then Judiciary pillar, now these groups of politicians are in such a creative mode to land their hands on business. Just what type of government is this? Where does UMNO intend to get the funds to secure the deal? Or am I too naïve to think that UMNO is not already cash-rich for such acquisition? Most importantly, is UMNO in politic or in business? No prize for giving the right answer.
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February 14th, 2007 by financetwitter
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Great article on revealing what is behind the scene.
Not only PECD, take a look at MAS and Proton. Both are run by the so called CEO, as selected by GHW …..GOD-KNOWS-WHO body, based on the NOT-AFRAID-LOSE capability.
Our tax money is all into the drain but CEOs who failed the mission would just walk away happy with tonnes of money, some of whom even is able to claim somemore ( like Mr Taju )even after scraping off a heaven of bucks from the company.
It’s the game plan within the party is all that I know. Be frank, the busy body is just a show of don’t be crony or I shall be more crony than.