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1MDB directors expected to quit en bloc next month: Report

KUALA LUMPUR — The board of 1Malaysia Development Berhad (1MDB) will likely be made to step down as early as next month, The Edge Financial Daily reported today (June 8), quoting sources describing the move as a prelude to wind down the troubled investment firm.

KUALA LUMPUR — The board of 1Malaysia Development Berhad (1MDB) will likely be made to step down as early as next month, The Edge Financial Daily reported today (June 8), quoting sources describing the move as a prelude to wind down the troubled investment firm.

Sources told the local business daily that the quit plan may also include those in 1MDB’s advisory board, which Prime Minister Najib Razak heads.

“This will happen in July or August,” the paper quoted the sources as saying.

1MDB’s board members includes chairman Lodin Wok Kamaruddin, Mr Shahrol Azral Ibrahim Halmi, who was formerly the firm’s chief executive, Mr Ismee Ismail, Mr Ong Gim Huat and Mr Ashvin J Valiram.

1MDB, which has racked up a reported debt of over RM42 billion (S$15.2 billion) since its inception in 2009, is currently under investigation by the Auditor-General’s Department and Parliament’s Public Accounts Committee for alleged impropriety in some of its deals.

On May 29, Second Finance Minister Ahmad Husni Hanadzlah said Abu Dhabi-based International Petroleum Investment Company and its Aabar Investments unit will pump in US$1 billion (S$1.36 billion) to 1MDB for the firm to pay off a US$975 million loan by June 4.

He also said the Tun Razak Exchange (TRX) and Bandar Malaysia projects will be spun off into separate autonomous firms, but did not state what would happen to 1MDB itself.

National news agency Bernama later reported that 1MDB will be wound down by next year and its operations transferred to three separate firms.

Asked to comment later, however, Mr Husni said the report was “not true”.

The TRX will be built on 70 acres of land sold to 1MDB four years ago for just RM4.5 million or RM64 per square foot.

The yet-to-be-built Bandar Malaysia is located in nearly 500 acres of land in Sungei Besi that was previously occupied by the Royal Malaysian Air Force airbase.

1MDB was incorporated in 2009, after the prime minister announced the decision to turn the Terengganu Investment Authority state fund into a federal agency.

Since then, 1MDB has been dogged by negative publicity over its finances and debt, and most recently cash flow problems that saw it struggle to meet a RM2 billion loan payment. MALAY MAIL ONLINE

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