Malaysia People were shocked by MCA Chua’s latest exposure on the alleged misuse of power and funds by Selangor government, forcing its listed subsidiary, KHSB to buy the overvalued properties from Talam’s RM676 million bail out.
Having no fear of people and relevant authorities, Selangor state executive councillor Teresa Kok openly admitted that Selangor government instructed KHSB to buy the allegedly overvalued properties and KHSB has no other option but to follow the instruction.
“KHSB as a state subsidiary is required to follow or adhere to policies stipulated by the state government,” said Teresa Kok.
Teresa’s statement is an insult to the minority shareholders of KHSB, a listed company on Bursa Malaysia. Based on Teresa’s statement, Selangor government is untrustworthy and unrealiable to the minority interests of KHSB. Bear in mind that KHSB is not a wholly owned subsidary of Selangor government and far more than that, it is a company listed on Bursa Malaysia. With this common sense, Selangor government has no right to instruct or force KHSB to buy the properties if the board of directors did not agree with the valuation.
Selangor government has clearly shown that there is no Corporate Governance being practised by them. How can they use the money of KHSB investors or instruct the board of directors to buy the questionable properties? Similarly, Selangor government cannot use the public funds to bail out Talam by taking over the overvalued properties and assuming RM230 millions of bank borrowing liabilities which cost RM86 million bank interests (yearly?).
If Selangor government sacrifice the minority interests of KHSB for Talam’s bail out, they are definitely set to be condemned by KHSB’s minority shareholders as their money had been misused by the distrusted hands.
Selangor government must promptly provide a clarification to the People especially the investors of KHSB why Selangor forced KHSB to take over the properties at an unreasonable valuation.
Selangor government should know that failing to practise the Corporate Governance, the confidence that the investors have in Selangor GLCs will collapse very soon and same to the People who will not trust a government which appears to have misused its power and the public funds to bail out its “sweetheart”.