Selling Off the Goose That Lays Golden Eggs

PERBADANAN KEMAJUAN NEGERI PERAK (PKNP), the Perak State Government's (the State) investment arm owns among many other companies, Perak Corporation Berhad (PCB). PCB has a 15% stake in Integrax Bhd, which translates to two seats on the latter's board of directors.

Integrax owns controlling stakes in Lumut Maritime Terminal (LMT) and Lekir Bulk Terminal (LBT), a strategic asset vital to Perak’s Industrial and economic interests. The State relies on PCB’s share in Integrax to exercise its check on the development of LMT and LBT, what many consider as the golden goose that lays golden eggs.

CEO of PCB, Datuk Aminuddin Md Desa has committed a grave impropriety in coming out with a public recommendation that the shareholders of PCB which owns 15% of Integrax Berhad, accept the offer of RM3.25 per share by Tenaga Nasional Berhad (TNB). He is also a director in Integrax and his dual-directorship puts him in a clear conflict of interest. It goes against the interests of the shareholders as an independent adviser has valued the stock price at RM3.62 per share.

It is nonsensically absurd that an individual who has a vested duty to protect the interest of the seller of shares, calls for a sale at lower price point than possible. In this regard, Perakians have every reason to cry conflict of interest; and certainly not unreasonable to demand more explanation to this bizarre board room antics that is putting the State’s interest in jeopardy.

Perakians must realise the gravity of the situation, and the damning consequences behind what is currently unfolding afore the eyes of Perakians. Should PCB sell out to TNB, the State will have relinquished all control over a LMT and LBT; a critical asset, vital not just for income generation, but key to State development as well. This sale is tantamount to selling off State interests to commercial and private interests and the Federal Government (TNB being a federal GLC) – an act of selling the golden goose that lays golden eggs.

The focus and objective of PKNP must be to uphold the economic development interest of the State. This raises questions that must be answered by Dato Seri Zambry Abdul Kadir as Menteri Besar and Chairman of the PKNP. PKNP, hence the Menteri besar must step in at this crucial juncture. The boardroom antics to push this sale forward needs to be halted immediately, pending a clearer picture and key questions addressed.

At the urging of Perak State Assembly, the State in its 2013 budget committed to establishing a Perak port authority, which unfortunately has yet to see fruition. I call for stronger state level legislation and strong political will to truly legislate all matters concerning the port, and furthermore, an urgent revision of the State Government’s previous announcement to set up a Perak Port Authority.

Not only is this yet another broken promise by the State to bring economic reforms, it also calls to question whether or not the Menteri Besar has lost control of PKNP and GLC’s in general. With no sight of establishing a port authority , nor sufficient State nor federal legislations to protect the economic and strategic interests of the State, before this ‘fishy corporate manoeuvre’ sees its end game , I call for the for the following;

• The Menteri Besar to make clear, whether or not this move to sell the State’s only remaining stake of Integrax to TNB, is indeed the will of the State.

• Menteri Besar, in his capacity as Chairman of PKNP, to exercise his authority and all necessary influence to withdraw PCB’s acceptance of TNB’s offer, pending further clarity.

• The Menteri Besar to explain the logic and rationale of PCB, and PKNP’s decision in divesting the States strategic interest in the State’s its most valuable coastal asset and gateway, selling the golden goose that lays golden eggs.

• The Menteri Besar immediately make public the reasons behind the failure to establish the Perak Port Authority, as promised in the 2013 State Budget.

• The Menteri Besar to explain whether or not there is a link between the failed attempt to delist PCB several months ago, with this ‘state stake sell-out’.

Failure to interject and halt this absurdity will be a clear indication of the Menteri Besar and the State Government losing control of GLCs.

It is time for the Menteri Besar to prove otherwise, and not sell off the Golden Goose.