By Khairie Hisyam
Rafizi Ramli
Pandan member of parliament (MP) Rafizi Ramli has filed an urgent motion in Parliament to debate the proposed lifting of a 49% shareholding cap on foreigners in relation to the proposed sale of ailing 1Malaysia Development Bhd’s (1MDB) power assets.
In a statement today, Rafizi claimed the Finance Ministry has decided to waive the cap to allow full equity sale in Edra to foreign buyers, referencing a letter bearing the Energy Commission’s letterhead dated Sept 11, 2015.
According to the letter provided by Rafizi, the commission discussed the proposed sale as well as the Finance Ministry’s proposal to waive the foreign shareholding cap on Sept 8 and has “no objections”.
However, the commission opined that any such decision should be a policy decision in line with the national economic transformation programme, according to the letter provided by Rafizi. KINIBIZ is unable to immediately confirm the authenticity of the letter.
Rafizi said his application seeks to have the urgent motion debated on Wednesday, Nov 18.
Normal procedure under the Standing Orders require MPs to submit written notice during working hours at least 14 days in advance to move a motion in Parliament. This notice period is seven days for cabinet members.
However, any MP may apply to move urgent motions of public importance with at least a 24-hour notice, according to the Standing Orders. Approving any such application, however, is subject to the speaker’s discretion.
Foreign buyers frontrunner?
Rafizi’s application to file the urgent motion came as expectations grow of a winning bid for 1MDB’s power assets to be announced any day now, with foreigners tipped to be frontrunners on the strength of a higher bid.
KINIBIZ earlier reported that a consortium of foreign entities, namely Qatari outfit Nebras Power and China General Nuclear Power Group, has submitted a bid of around RM10 billion for 1MDB’s power assets parked under Edra Global Energy.
This is some 25% higher than a competing bid by sole distributor Tenaga Nasional Bhd, whose bid is in the RM8 billion region, said sources with knowledge of the bidding.
On Oct 16, 1MDB said it had received binding and fully funded offers from three separate bidders for its power assets, which its books value at about RM12 billion not including attached debt, although industry sources told KINIBIZ that the power assets may come to a value as low as RM7 billion based on existing power purchase agreements.
While 1MDB did not name the bidders, citing confidentiality agreements, Tenaga Nasional separately announced that it had submitted a bid.
On Oct 29, KINIBIZ reported that the two foreign bidders in the running for the power assets, China General Nuclear and Nebras Power, had joined together in a consortium for the bidding process.
1MDB is currently the second-largest independent power producer in Malaysia behind Tenaga Nasional.
The proposed sale of Edra is part of 1MDB’s rationalisation plan to assist in coping with its RM42 billion in borrowings, which the company is facing problems servicing.
It is currently seeking to sell a 60% stake in its 486-acre Bandar Malaysia development, which has an estimated gross development value of as much as RM40 billion, according to past reports.
KINIBIZ previously analysed the proposed sale of Edra and its implications in a four-article series here.
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