20 minutes
PETALING JAYA: Urusharta Jamaah Sdn Bhd, a wholly owned subsidiary of the Ministry of Finance said it completed the transfer of non-performing assets held by Lembaga Tabung Haji (LTH) on Dec 28, 2018.
In a statement released today, Urusharta Jamaah said the transfer was done as part of LTH’s rescue and restructuring plan.
“This was done as a result of previous financial mismanagement and wrongdoings. The transaction above involved the transfer of assets with a market value of RM9.63 billion from LTH to Urusharta Jamaah in exchange for RM19.90 billion, consisting of 2 tranches of Sukuk totalling RM19.60 billion and RM300 million in cash payable to LTH,” it said.
“The difference of RM10.3 billion between the consideration of RM19.90 billion and RM9.63 billion market value of assets is to be borne by the government to ensure that the financial health of LTH is restored,” it added.
In the event the value of the assets depreciates further, then the losses for the government are estimated to be higher than RM10.3 billion.
Urusharta Jamaah further explained that the assets transferred to it consisted of a mixture of listed equity holdings, properties and one unlisted plantation asset.
The property assets transferred to Urusharta Jamaah include a 1.568-acre parcel of land at Tun Razak Exchange, which was purchased by LTH at RM188.5 million or RM2,760 per square foot (psf), significantly higher than that paid for by 1Malaysia Development Berhad (1MDB) at only RM75 psf or RM5.1 million.
“Urusharta Jamaah then purchased the TRX land from LTH at RM400 million or RM5,856 psf, which does not reflect the actual market value of the said land. The purchase consideration was done at a significant premium (112.2%) to what LTH paid in April 2015 (RM188.5 million or RM2,760 psf),” the statement said.
In a recent valuation exercise conducted in March 2019, the market value of the said TRX land stood at only RM205 million.
Urusharta Jamaah further noted that the huge difference between the market value and the purchase value of the land together with all the other assets it acquired was needed to ensure the successful rescue and restructuring plan of LTH.
“Overall, Urusharta Jamaah will bear significant losses as a result of impairment charges estimated at more than RM10 billion for the assets acquired from LTH. The TRX land transaction itself will result in an impairment charge of RM195 million.
“With the transfer of assets now completed, Urusharta Jamaah will continue with its mandate and purpose, which are to carry out the rehabilitation and restructuring of assets under its care; to maximise asset recovery value; and to redeem all monetary instruments issued by Urusharta Jamaah and subscribed by LTH in a timely manner,” it said.
