Auditors declare Talam deal ‘sound commercial decision’

September 05, 2012

Selangor had appointed the auditors following claims of impropriety from MCA. — File pic

KUALA LUMPUR, Sept 5 — Independent auditors have cleared the Selangor government of any irregularities in its debt recovery exercise involving the company formerly known as Talam Corporation and declared it a “sound commercial decision,” Mentri Besar Tan Sri Khalid Ibrahim said today.

Khalid’s administration had appointed KPMG Transaction and Restructuring Sdn Bhd (KPMG) in July to review its RM392 million debt recovery exercise following allegations by MCA that the state government’s dealings with Talam — now known as Trinity Corporation — was lopsided and had ended up costing taxpayers up to RM1 billion.

Khalid said the debt settlement was in the form of assets comprising nine plots of land, two properties, a 60 per cent stake in a subsidiary of Talam and cash/debt assignment.

“From the review exercise, KPMG is of the view that the Selangor state government made a sound commercial decision under the circumstances at that point in time in relation to the settlement arrangement.

“The settlement process is still ongoing and based on currently available information, the gross consideration is sufficient for Menteri Besar Selangor Incorporated (MBI), being the party tasked with recovering the debts on behalf of the Selangor state government and its subsidiaries, to recover the Talam debts, with no debt waiver by MBI.”

In July, Khalid had said the Selangor government would appoint independent auditors to review its debt restructuring agreement with Talam Corporation and clear the air over claims of funds abuse by MCA.

Khalid insisted his administration had not relieved Talam Corp of its debts as claimed, but instead had recovered monies that the troubled property developer owed the state’s subsidiaries.

MCA Young Professionals Bureau chairman Datuk Chua Tee Yong had recently alleged that Khalid’s administration bought over Talam Corp’s RM676 million assets to clear the firm’s outstanding debts of RM392 million to three state subsidiaries.

He further claimed that the RM392 million in the supplementary budget approved by the state assembly in November 2010 to the MBI was used by the state government for the alleged bailout.

Trinity Corporation had also denied allegations that it sold land to the Selangor state government at above market value, pointing out that the valuation fell under the scrutiny of the Securities Commission’s Assets Valuation Department.

The company added in a stock exchange filing in July that the valuation was also approved by SC and Bursa Malaysia.

Speaking today, Khalid said the auditor’s conclusion demonstrated that the debt recovery was legal, ethical, done in good faith and had in no way compromised the interests of the state, its subsidiaries or the people of Selangor.

Khalid added that the state had appointed four spokesmen to speak about the matter. The four are MPs Dr Dzulkifli Ahmad from Kuala Selangor, Tony Pua from Petaling Jaya Utara, William Leong from Selayang and political secretary to the mentri besar, Faekah Husin.

“These four are authorised to discuss and debate the issue with any individuals or organisations they deem fit. We are confident that with their expert command of the facts at hand, they will able to facilitate healthy and informative discourse,” said Khalid.

http://www.themalaysianinsider.com/malaysia/article/auditors-declare-talam-deal-sound-commercial-decision/

Related:
http://myinvestingnotes.blogspot.com/2012/07/talam-for-dummies.html