Waterlands?? NO!! It’s Wonderlands of Khalid!

The Selangor Menteri Besar Abdul Khalid Ibrahim had once said that the state government would not comment on the questionable valuation of Talam’s RM676 million “bail out” because it had decided to take legal action against MCA.

However, the scandal took a U-turn last week when Khalid broke his silence and said that the acquisition of the questionable lands by state government-linked companies (GLCs) from Menteri Besar Incorporated (MBI) was intended for development.

He said the state stood to gain huge profits if the GLCs developed the land first instead of selling them as it is.

“The value of land is less than the value of development. The state has got enough knowledge on what to develop and enough power to approve the development,” Khalid said in an interview by Malaysiakini on 29 July 2012.

The remarks made by Khalid remind us the story of “Gambler and The Chicken”.   

Once upon a time, a gambler always squandered his wife’s money on gambling.  Despite being scolded by his wife to stop the bad habits, the gambler thought of many ideas to cheat his wife’s money.  One day, he brought a chicken to his wife and told his wife to pay him all family weath for the chicken. 

“This chicken is priceless because it can lay eggs. The chicks might have hatched from the eggs and the chicks would become hens, they will each lay eggs and those eggs will hatch and become more hens, which will lay more eggs that will hatch into chicks…therefore, this chicken will bring us great fortune and we can make huge gains”.  Of course, the wife was not stupid to believe the gambler for this time. She gave him a slap and divorce with the gambler.

Does the chicken story sound familiar when Khalid used the intended development to justify the questionable valuation of the lands which are partially/fully submerged in water?

Well, Khalid may think that the Government have the power to approve a high-density mixed development project on a football field in Kelana Jaya, and so can approve the likes on land submerged in water. 

What he fails to see is that not every land has the potential like the football field in Kelana Jaya, which is in the centre of matured residential and commercial area!   While the Selangor MB may have the power to approve any development order but he certainly cannot guarantee buyers and investors for what is developed, unless, of couse, the cash rich GLCs are asked to “participate” again.

Prior to Selangor MB’s defense of the value of the land acquired from Talam based on the concept of gross development value (“GDV”), DAP Tony Pua has told the press that the Selangor government had managed to acquire the 13 parcels of land from Talam Corporation Bhd at a RM9.1 million discount. He said this was based on the difference in a private firm’s valuation of the land, which amounts to RM685 million, against the state’s valuation, which amounts to RM676 million.

While MCA Chua had criticized the move was a bailout and and raised questions on the apparent over-valuation of land acquired particularly, the bestari jaya land and Danau Putra land.

However, a month has passed and the Selangor Government still cannot produce evidence and basis of the alleged State’s valuation which amounts to RM676mil.  The question of how the RM676m is arrived at remains unanswered.

A proper valuation and due diligence should be conducted on any land and properties acquired by Selangor State Government and/or Glcs.  In this context, even though the acquisition of the land and properties are part of a debt recovery exercise, valuation remains as important as in any other sales and purchase transaction.

Failure to observe the checklist for land acquisition, the implication is serious and the damage could be much bigger than one could imagine than he thinks.

In order to illustrate this point, let’s take a closer look at the Danau Putra land.

We will keep aside Bestari Jaya land pending clarification from Selangor State Government on its basis of offering RM80,000 per acre despite the valuation by Talam’s valuer was at a lower value of RM60,000 per acre.

Danau Putra Land acquisition

The value appraised by Talam’s valuer is RM93.5 million and the encumbrances of the said land is RM35.6 million.  Hence, the state government said they got excess of RM57.9 million (IRM93.5 million – RM35.6 million) to contra off against the amount to the state government by Talam.

However, the real market value is only RM30.43 million if based on what people willing to offer at the public auction.  This real market value is not enough to cover the encumbrances of RM35.6 million.  Hence, the state government actually did not recover any debt but instead assumed net liability (bank borrowings) of RM5.17 million (RM30.43 million – RM35.6 million).

In other words, the state government have foolishly assumed net liability of  RM5.17 million bank borrowing and at the same time forgo RM57.9 million debts owing by Talam.  In total, the state government has actual loss of RM63.07 million (RM5.17 million + RM57.9 million). 

The above shows that the Selangor Government is actually worse off by embarking on the debt recovery exercise.  Obviously, the cause for this nightmare is “over-valuation”.

Now, the loss of RM5,170,000 shown above is in the form of immediate cash outflow hidden in the encumbrances taken over by State. There is simply no proper explanation to it whether it is based on the RM9.1 discount as alleged by Tony Pua or the “GDV” concept mentioned by MB.

The State has to use its own resources to pay for the shortfall of RM5,170,000 besides losing the rights to recover any of the debts it set out to recover via contra.

The party who bears the shortfall will be the one who actually takes over the encumbrances either directly or by obtaining a loan to discharge the land from the encumbrances.

It is certainly a nightmare if the same scenario applies to all or most of the other 13 parcel of lands.

Malaysia People just want to know whether Khalid was too generous in accepting the questionable valuation or he is a man who lives in his own fantasy believing the water-lands can become wonderlands one day.

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43 thoughts on “Waterlands?? NO!! It’s Wonderlands of Khalid!

    • It is best to ignore this blog! There is no point putting your comment here. Better put your time to read Politicians blogs/FB (BN & PR) and put in useful comment for improvement. This blog is just like kid fighting only. It will not bring Malaysia to a greater heights.
      No matter what they reply to this comment, please do not reply.

      Please be reminded again, don’t take concern to whatever they write. Don’t lower your standard.

      • You either trying to be ignorant or you don’t have financial knowledge to understand the blog. LOL.

    • Dear CONCERN CITIZEN

      I NOTICE AFTER YOUR POSTING…PRATICALLY MOST OF THE PROs STOP COMMENTING ON THIS WEB PAGE.
      ARE YOU REALLY A CONCERN CITIZEN OR YOU ARE A HEAD OF A GROUP OF PROs DIRECTING YOUR AGENDA.
      IT SEEM THAT WAY TO ME AS ALOT OF PROs COMMENTS STOPPED AFTER YOUR POSTING.

      THIS TRULY SHOWS THAT THERE IS A PROFFESIONAL GROUP OF CYBER TROOPERS OUT TO SPREAD LIES AND HATE AMONGmMALAYSIAN FOR THEIR POLITICAL INTEREST AND AGENDA. THIS IS mSAD, AS THEY ARE ALSO ENFLAMING RACIAL TENSIONS AMONG mMALAYSIAN.

      THEY POST PRO CHINESE COMMENTS TO CHINESE. WHILE ALSO POSTING PRO MUSLIM COMMENTS TO MUSLIM

  1. THIS IS THE MOST LUDICROUS STATEMENT EVER TO BE MADE BY MB!

    HE IS TALKING LIKE ‘ENRON’…….MAKING FUTURE MONEY TODAY!
    And we all know what happen to that company. NOTHING BUT LIES!!!!!!!!!!!!!

    • Very ridiculous, all Selangor people with Agri land can sell their land to Selangor government at higher value because MB has the power to convert the land for development.

      • I would buy an agri land submerged in water and sell to MB at big profits since he doesn’t care the conditions as he can use his power to approve any plan.

  2. I seriously doubt he went to the site to check. I will wait for his intended development and learn how he can turn the lands submerged in water into the land with value.

  3. Khalid, Teresa and Tony, three fellows without creditability. They can deceive many people but not all people.

    • You like people to fxxx you?? Ask your MCA president to book a room with you and wait for your CD, we know who has creditability.

      • DEAR L3,

        Well come back to the discussion. The issues at hand is about your beloved MB making an ‘ENRON’ statement concerning the TALAM DEAL.
        Your constant deviation of topic and lack of vocabulary on subject at hand ONLY prove that the PR is exactly what we are saying.

        IF YOU DON’T AGREE THEN GIVE YOUR COMMENT……..
        DON’T JUST SHOOT FOUL LANGUAGES AND COMMENTS.

        As said numerous times,
        NOTHING BUT FOUL SMELLS COME FROM YOUR MOUTH.

  4. To me, what is the best thing about the MB’s ‘ENRON’ statement is that he is a CORPORATE MAN!

    SO I GUESS ALL CORPORATE PEOPLE THINKS ALIKES AND ARE ALWAYS MAKING FUTURE PROJECTED MONEY TODAY.

    Can any CORPORATE people give us your thoughts!

    • Also as explained earlier, we are NOT MCA members but
      CONCERNED CITIZENS.

      YOUR CONSTANT USAGE OF PROFANITY ONLY SOLIDIFY YOUR LACK OF MANNERISM AND CHARACTER.

    • This is NOT crap as mentioned by SG PR,
      The senario is very SIMPLE,

      SAYS, someone have a piece of LOUSY land in the middle of a JUNGLE,
      THEN, he comes to sell to you that piece of land at a very high price,
      OBVIOUSLY, you DON’T AGREE because it’s NOT useable NOW,
      BUT, he insist that the land WILL EVENTUALLY be in demand.
      but when, nobody knows, even GOD DOESNT KNOW.
      HOWEVER, you still buy it.
      SO NOW YOU NEED TO EXPLAIN “WHY” TO YOUR FAMILY AS THEY WOULD LIKE TO KNOW WHAT HAPPENED.

      • I cannot accept the fact that Khalid’s financial knowledge is poor as he was the CEO before.

        He must the first person who use “intended” plan to evaluate the price of the lands. Why not he just say the state intend to build disneyland there and that’s WHY they paid so much for the land.

  5. Khalid is misleading Selangor people. He is talking about vacant land, therefore he should value the land based on the market value. He need to do more to convince the Selangor people that the lands worth so much.

    • All I care is the debts from Talam have been fully recovered. They are debts caused by previous BN’s time. Tony has explained well. Khalid did a great job of recovering them. They would have turned into bad debts if not because of Khalid. This blog wrote a pack of misleading lies.

  6. Its is best to ignore this blog! There is no point putting your comment here. Better put your time to read Politicians blogs/FB (BN & PR) and put in useful comment for improvement. This blog is just like kid fighting only. It will not bring Malaysia to a greater heights.

    • Did you really read and understand the blog? Obviously it is difficult to be understood by people with no financial knowledge.

      • It’s created by someone who don’t understand accounts, The truth is Selangor recovered all the debts owing by Talam caused by previous BN government. Of course this blog tell a pack of lies to mislead people. If not, how come this blog don’t report Tony Pua and Teresa Kok’s explainations ?

  7. Khalid is talking crap. I am sure there are better choices outside at this offer price. Why paid so much for lands submerged in water? Intend to build a dam?

  8. Khalid, ugly explanation. Learn from Guang Eng on how to govern Penang. If PR lost Selangor in coming election this guy is the cause.

      • PRAISING FOR KHALID….ITS FOR HIS OWN SELF.
        THEY ARE IN THE SAME GROUP…BY PRAISING KHALID, IT IS INDIRECTLY ALSO PRAISING HIS PR GROUP.
        DO YOU SERIOUSLY THINK HE DARE TO TALK BAD ABOUT KHALID.
        EVEN IF KHALID RELEASES GAS….LGE WILL PRAISE IT FOR SMELLING LIKE PERFUME.

        SO HOW CAN YOU USE LGE COMMENTS TO REFLECT THE PUBLIC VIEWS AND CONCERNS.

    • He did. That is how he can recovered all the debts from Talam caused by the previous government. Teresa Kok and Tony Pua explained well and invited MCA together but they chickened out.

      • Obviously you did NOT read nor understand the previous articles and comments in this web page.
        As highlighted…it is a sham when PR said they recovered TALAMs DEBT.

        THE CONTRA OF LAND IS ACTUALLY A PIECE OF LAKE at best. It will be difficult and costly to be DEVELOPED.
        IF TO BE SOLD…IT WOULD BE UNSALEABLE….IT MAKE NO ECONOMIC SENSE TO EVEN BUY IT LET ALONE CONTRA FROM DEBT.

        SO..WE ARE ASKING THE STATE GOVERNMENT….WHY?
        DONT WE HAVE A RIGHT TO ASK WHY?
        THAT IS WHAT WE CONCERNED CITIZEN VOTED THESE PEOPLE INTO POWER.
        NOT FOR THEM TO DO AS THEY PLEASED FOR THEIR OWN POLITICAL GAIN OR INTEREST.

    • Exactly. Talam’s case is a scandal between previous BN’s time and Talam. Present Selangor State Government did a good job of taking over Talam’s properties to setoff the debts. The papers that are government controlled don’t report the truth. This politics.

      • You kept cutting and pastering your earlier comments all over this web page…..you are even TOO LAZY to write
        your comments accordingly to the various different comments.

        Your lack of respond to even properly address your rebutal shows you got NOTHING TO SAY.
        you are just trying your very best to SPREAD LIES and CONfuse other readers.

  9. Dear CONCERN CITIZEN

    I NOTICE AFTER YOUR POSTING…PRATICALLY MOST OF THE PROs STOP COMMENTING ON THIS WEB PAGE.
    ARE YOU REALLY A CONCERN CITIZEN OR YOU ARE A HEAD OF A GROUP OF PROs DIRECTING YOUR AGENDA.
    IT SEEM THAT WAY TO ME AS ALOT OF PROs COMMENTS STOPPED AFTER YOUR POSTING.

    THIS TRULY SHOWS THAT THERE IS A PROFFESIONAL GROUP OF CYBER TROOPERS OUT TO SPREAD LIES AND HATE AMONG MALAYSIAN FOR THEIR POLITICAL INTEREST AND AGENDA. THIS IS SAD, AS THEY ARE ALSO ENFLAMING RACIAL TENSIONS AMONG mMALAYSIAN.

    THEY POST PRO CHINESE COMMENTS TO CHINESE. WHILE ALSO POSTING PRO MUSLIM COMMENTS TO MUSLIM

    • Sorry……i have posted this comment earlier but the computer didnt move so i thought it didnt sent my comments.
      DID NOT TRY TO BE LIKE THE PROs CUTTING AND PLASTERING EARLIER COMMENT ALL OVER THE WEB PAGE.

      MY APPOLOGIES.

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