[mr arul and 1mdb, your explanation to this article is required and appreciated!] ... The Illogical Kandasamy Strikes Again: The Non Machai Guide for Bandar Malaysia
WARNING THIS POST IS NOT SAFE FOR MACHAIS
After a few clarification...Malaysia's No 1 Value Extractor still could not get it right.
Further Clarification on Bandar Malaysia Equity Sale1MDB notes that certain questions, queries and concerns have been raised by various parties over the recently announced sale of 60% equity in the Bandar Malaysia project, to the consortium comprising Iskandar Waterfront Holdings (IWH) and China Railway Engineering Corporation (CREC) ("Consortium").
We provide below a detailed explanation, which we trust will conclusively dispel the half-truths and misleading statements made by various irresponsible parties.
1. Bandar Malaysia Sale - Current Proposed Deal StructureThe Sg Besi land is currently owned by TRX City Sdn Bhd (formerly 1MDB Real Estate Sdn Bhd) and Bandar Malaysia Sdn Bhd. TRX City Sdn Bhd owns 4 (four) plots and Bandar Malaysia Sdn Bhd owns 12 (twelve) plots which collectively make up the acreage of the project. Both companies are ultimately owned 100% by 1MDB. The current proposed deal structure, is for a New SPV 1 to be formed, that will directly purchase the land (or indirectly purchase, for example through a New SPV 2 or through purchase of equity in Bandar Malaysia Sdn Bhd). New SPV 1 will ultimately own all 16 plots of the Sg Besi land and develop the Bandar Malaysia project.
New SPV 1 will be owned 40% by 1MDB or Minister of Finance Incorporated (MoF Inc) and 60% by the IWH-CREC Consortium.
The Consortium shareholding is 40% CREC and and 60% IWH.
IWH shareholding is 40% Kumpulan Prasarana Rakyat Johor (KPRJ – Johor State Govt) and 60% Credence Resources (Tan Sri Dato’ Lim Kang Hoo).
So, given the above shareholdings of the various parties the ultimate New SPV1 ownership can be described in the following ways:
A. 40% 1MDB or MOF Inc (should the shares be transferred), 36% IWH and 24% CREC. The ultimate project ownership therefore is 76% Malaysian and 24% Chinese.
OR, in the alternative:
B. 40% 1MDB or MOF Inc (should the shares be transferred), 22% Credence Resources, 14% KPRJ and 24% CREC. The ultimate project ownership is therefore 54% Government and 46% private sector (Government: Federal 40% via 1MDB/MOF Inc and State 14% via KPRJ. Private sector: 22% Credence Resources and 24% CREC).
2. Difference in announced values RM7.41 billion (1MDB) vs RM5.3 billion (CREC)In essence, 1MDB are selling land, which is what we own. However, there are two liabilities indirectly linked to the land i.e.:
A. Remainder costs to complete relocation of Pangkalan Udara KL (PUKL Relocation)
B. The Bandar Malaysia Sukuk (Sukuk) – this debt is at Bandar Malaysia Sdn. Bhd. (Nominal Value RM2.4 billion at maturity, accrued value approximately RM1.63 billion at 31 December 2015)
3. Final Purchase Consideration DeterminationTo determine the final purchase consideration to be received by 1MDB, the starting point, as agreed in the Share Sale and Purchase Agreement (SSA) executed between 1MDB and the Consortium, is 100% of the land value = RM12.35 billion.
- determination and agreement between the parties of the final costs for the PUKL Relocation and the Sukuk and;
- all relevant consents, including but not limited to, from the Government of Malaysia, the contractor (PPHM) and sukuk investors.
Where should we start folks?
How about this
"We provide below a detailed explanation, which we trust will conclusively dispel the half-truths and misleading statements made by various irresponsible parties. "
Half Truths and Misleading Statements...
Lu punya Press Statement yg Teramat Misleading doe
Anyway as usual with my Public Interest Posting...we shall DEAL ONLY with VALIDATED DATA
Not some opinion from Half Baked "Experts" on Facebook.
Lets go back to the very start of this mess.
Drum roll please..........
A long long time ago ...
In a Galaxy not to far away...
Chapter 1: The Iron River Mystery : 12 Vs 16 Plot of Land
What 1MDB said:
"The Sg Besi land is currently owned by TRX City Sdn Bhd (formerly 1MDB Real Estate Sdn Bhd) and Bandar Malaysia Sdn Bhd. TRX City Sdn Bhd owns 4 (four) plots and Bandar Malaysia Sdn Bhd owns 12 (twelve) plots which collectively make up the acreage of the project."
Data in 1MDB Annual Report
Recall the Magic Table
0.4 Billion Cost for Bandar Malaysia
So what happened to the 12 Plots after being transferred to 1MDBRE
The 12 Plots of Land went from 363Million (1MDB) to 650Million (1MDBRE) to 4.2Billion (BMSB)
Excellent Value Creation there mate!!!!!
Anyway I have not found any reference at all about the remaining 4 Plots held by 1MDBRE
Please let me know which page of the annual report says that there is actually 16 Plots of Sg Besi Land.
CHAPTER 2: WHO's LIABILITY IS IT?
We now need to study what they meant when they said "The Acquisition is not complete pending the execution certain other related agreements" above
What agreement are these?
These agreements later became Collaterals for the 2.4Billion Sukuk issued by BMSB
Let us now go back to what they said
"2. Difference in announced values RM7.41 billion (1MDB) vs RM5.3 billion (CREC)In essence, 1MDB are selling land, which is what we own. However, there are two liabilities indirectly linked to the landi.e.:A. Remainder costs to complete relocation of Pangkalan Udara KL (PUKL Relocation)2 Liabilities indirectly linked to the Land????
Only problem is that these are not BMSB Liabilities
These are 1MDB's and 1MDBRE's
And following their standard Ali Baba SOP they contracted Perbadanan Perwira Hartanah to undertake the Construction Cost
We now need to look back at CREC Announcement
ANY MENTION OF SPV 1 or SPV 2 ?
THE ONLY THING MENTIONED IS BMSB
It even said the they have ENTERED INTO A SHARE SALE AGREEMENT WITH 1MDBRE TO PURCHASE BMSB
Machais2 still following me here ...ke dah garu kepala kata gua tengah kencing lu semua
Anyway we now go to the other part where 1MDB said that it require "all relevant consents, including but not limited to, from the Government of Malaysia, the contractor (PPHM) and sukuk investors."
Why is that?
Recall the Bandar Malaysia 2.4Billion Sukuk
Nak Jual BMSB must get BondHolders Approval
Jual Tanah Sg Besi duit musti buat bayar hutang dulu...
The above is from their annual report.....look at (e) it says 5 Development Agreements.
I have another data from the Principal Terms and Condition of the Sukuk which says 8 Development Agreements as per the picture above on the Relocation Agreements.....wallahwualam sapa yg betul
But there's one particular positive covenant to the Sukuk Issuance which 1MDB will /or has breached with the sale of BMSB
- CREC entered into S&P to purchase BMSB from 1MDB RE
- 1MDB says CREC will buy either SPV 1 or SPV 2 or whatever shit they will cook up in the next 24hours
- 1MDB talks about Relocation Cost Liabilities attached to the Land but CREC is buying the Equity in BMSB and all liabilities is NOT with BMSB but is with 1MDBRE or 1MDB
- SUKUK Holders can BLOCK this TRANSACTION using all the terms embedded in the Sukuk Agreement.
- What is this 4 Additional Plot of land that 1MDB is talking about? All References in the Annua Report points to 12 Plot of Land. Is 1MDB trying to inject TRX land into the Deal? Or Did 1MDB break up the original plots being transfered by GOM to 1MDB?