The Malaysian Insider has proven itself to be a tool to extend the Anwarisra agenda with the habitual consistancy of spinning and manipulating facts and words and eventually manufacturing new ones.
This is what their story about what Minister in Prime Minister’s Department Dato’ Seri Abdul Wahid Omar take on 1MDB’s solvency:
Minister admits 1MDB debt burdensome, Putrajaya to stop all new loans
BY MOHD IZWAN
Published: 17 April 2015 12:39 PM
Datuk Seri Abdul Wahid Omar admitted that the Ministry of Finance’s strategic investment fund 1Malaysia Development Bhd (1MDB) is a burden, given its failure to generate cash flow against its huge debts.
The minister in the prime minister’s department said that 1MDB had taken loans from banks and the capital market to purchase assets, but failed to raise cash flow, causing it to be unsustainable.
Wahid said 1MDB had expanded by taking loans from banks and the capital market which they had used to purchase assets, including IPPs, causing their debt to rise to RM42 billion as of March 2014.
“So you can imagine the quantum; it is very high and tough,” he said at a forum in Petaling Jaya last night.
Responding to questions posed by the audience, Wahid said that as long as the assets were not able to generate cash flow, 1MDB will fail to be sustainable.
“Unless it can generate cash flow, it will not be sustainable,” he said.
He added that the debt is expected to have an impact on 1MDB and that three strategic steps have been taken to address the problems.
“They have taken strategic steps to re-evaluate the business model and structure, and three decisions have been taken,” he said.
According to Wahid, these included halting all forms of new loans, focussing on the two main projects, namely the Tun Razak Exchange (TRX) and Bandar Malaysia, and to ensure the initial public offering of IPP Edra Energy can take place soon.
“These are the strategic steps that have been identified,” he added.
Criticism has been mounting over 1MDB, which was established in 2009 and has chalked up debts of up to RM42 billion.
This led to Prime Minister Datuk Seri Najib Razak ordering the Auditor-General to “independently verify 1MDB’s accounts”, with the findings to be submitted to the Public Accounts Committee (PAC). – April 17, 2015.
According to this story, 1MDB was reckless in raising financing which include borrowings to fund its acquisition but failed to generate adequate ensure the cash-flow to service these financing commitments.
Now, compare that with what Wahid actually said about 1MDB at the Akademi Kapten Hussein.
“It was a strategic investment management company. Their model was to raise long term bonds. Aided by Government guarantee, it would help to lower cost of funds and invested in long term investments”.
“The burden of servicing (the financial commitments) such a high debt is difficult. So until and unless the assets are able to generate the cash-flow, it is not sustainable. That is something the board and management of 1MDB had realised and they have undertaken a strategic review of their business model and capital structure and they have decided three things:
1. Not to incur any new debts unless to meet the current debt obligations or refinance the current obligations
2. They have agreed not to embark on any new projects or ventures and focus the efforts on the two big projects; TRX and Bandar Malaysia
3. Work as much as possible to get the IPO of Edra Energy (holding company of the IPPs) going. This IPO will get proceeds to reduce their debts. Plus if they were to reduce their holdings to below 50%, then they are able to de-consolidate all the debts at subsidiary level.
There were a number of allegations as contained in the Sarawak Reports and a number of other publications. It would be investigated. Prime Minister has made a commitment for an audit to be undertaken by the Auditor General and the report would be presented to the Public Accounts Committee (PAC).
Lets draw a line. We will do that audit for all the past actions. But what is important is for us to be constructive and focus our efforts on solving the current issue”.
Summarising the story should not tantamount to putting words into the Minister’s mouth. That is manipulating what the Fellow of Chartered Association of Certified Accountants and former President and Group CEO of the largest commercial bank, Maybank, actually said.
Spinning even in dry mode is utterly ‘laundering information’. Unless going low is the best that Anwaristas could do trying to stir up shit storm when their boss’s agenda has guttered into oblivion, then they should uphold the true principles of journalism which is telling the true story.