Thursday, May 24, 2012

Government pressed on Tajudin deal after claims by Khairy

May 24, 2012
KUALA LUMPUR, May 24 — The government’s confidential settlement of its claims against Tan Sri Tajudin Ramli is under renewed scrutiny after Umno Youth chief Khairy Jamaluddin claimed knowledge this week that national asset restructuring company Danaharta did not lose money in the out-of-court deal.
The DAP today demanded answers from Prime Minister Datuk Seri Najib Razak after Khairy reopened the debate on the controversial sealed settlement by claiming during a televised debate with PKR’s Rafizi Ramli that he had been told by sources that the government had not lost out in the arrangement with Tajudin (picture).
“Datuk Seri Najib Razak must immediately confirm if indeed his Umno Youth chief is telling the truth or is lying to the public over the above scandal. This is especially since it is the first time a BN (Barisan Nasional) politician has claimed that Tan Sri Tajudin paid part or all of his outstanding debt as part of the settlement exercise,” DAP national publicity secretary Tony Pua said in a statement today.
Khairy had cited “sources” that the former Malaysia Airlines (MAS) chairman may have paid more than the RM589 million owed to Danaharta as a result of the still undisclosed out-of-court settlement.
Pua pointed out that this was despite the fact minister Datuk Seri Nazri Aziz had last year directed all government-linked companies (GLCs) including Danaharta to withdraw all civil suits against Tajudin as both the government and the Finance Ministry had agreed that the cases will be settled out of court.
“Khairy’s claim is completely unbelievable and lacks all credibility given the clandestine manner in which the government has sought to cover up the entire episode and the refusal of any minister to confirm or deny the claim that Danaharta had in fact written off all of Tajudin’s debt,” the Petaling Jaya Utara MP said.
Danaharta and Tajudin ended their drawn-out legal battle when they settled out of court on February 14 after Putrajaya had directed in August all GLCs to drop civil suits against the former protégé of Tun Daim Zainuddin.
But the terms of the settlement remain confidential between the two parties despite a High Court decision in December 2009 for Tajudin to pay Danaharta RM589.14 million with two per cent interest per annum backdated to January 1, 2006.
Politicians from across the divide have demanded details of the out-of-court settlement between the tycoon and Danaharta be made public, but the government has kept silent so far.
In March Parliament’s Public Accounts Committee (PAC) had also demanded Putrajaya reveal details of the out-of-court settlement reached between one-time national asset management firm Pengurusan Danaharta Bhd (Danaharta) and Tajudin.
The Malaysian Insider had learnt that the 13-man panel made a “nearly unanimous” decision to ask the Finance Ministry and Prokhas, its unit which manages Danaharta’s residual assets, to explain the confidential settlement that was reached on February 14.
Tajudin was a poster boy of Tun Dr Mahathir Mohamad’s now discredited policy of nurturing a class of Malay corporate captains on government largesse. He flew high in the 1990s but fared poorly during the Asian financial crisis.
The former prime minister’s policies had been the subject of scrutiny after the Najib administration decided to settle out of court the outstanding RM589 million debt owed by Tajudin from the loan he took to buy MAS in 1994.
The case between Danaharta and the tycoon arose after he executed a facility agreement on July 13, 1994 to borrow RM1.79 billion from a group of syndicated lenders to finance the purchase by him of a 32 per cent stake in MAS.
However, from 1994 to 1998 he failed to service the original loan, causing it to become a non-performing loan (NPL).
In 1998, Danaharta acquired the NPL from the lenders but Tajudin also failed to settle his debts with Danaharta until they were in default of RM1.41 billion as of October 8, 2001.
As of December 31, 2005, the amount outstanding was RM589.14 million and on May 11, 2006, Danaharta and the subsidiaries commenced action to recover the money.
Tajudin alleged in his affidavit that he was directed by Dr Mahathir and Daim in 1994 to buy a controlling stake in MAS to bail out the government.
The businessman claimed that his purchase was a forced “national service”, disguised as an arm’s length commercial deal, because the government wanted to appease the investment community and the public.
Dr Mahathir, however, denied in his autobiography published last March that he and Daim had forced Tajudin to bail out MAS in 1994 for RM1.8 billion, claiming instead that the tycoon was “elated” over his purchase.

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