One wonders if Telekom Malaysia Bhd (TM) has short-changed itself by disposing its 100% interest in Menara Kuala Lumpur Sdn Bhd (MKLSB) for a mere RM3.8 mil when the net profit recorded by the latter through concessions and the right to manage Menara KL was said to be worth as much as RM20 mil in 2019 (2018: RM25 mil).
According to TM’s 3Q FY2022 financial announcement to Bursa Malaysia, the telco group had on Oct 31 completed a share purchase agreement to dispose its 100% interest in MKLSB for RM3.8 mil comprising of cash and the acquirer’s commitment to make good obligations associated to the concession.
Interestingly, the announcement made no mention of the acquirer’s identity, notably whether it was the said financially troubled Hydroshoppe Sdn Bhd and whether the transaction entailed “10 million shares” as reported by the FocusM yesterday (Dec 28).
For the uninitiated, Menara KL is owned by the Government while the operations and maintenance of the tower is granted under a concession. TM via its wholly owned subsidiary MKLSB had undertaken the concession since 1996.
Meanwhile, the Malaysian Anti-Corruption Commission (MACC) is investigating elements of corruption in the sale of 100% of shares belonging to a TM subsidiary to a company in the issue of the transfer of ownership rights to the management of Menara Kuala Lumpur (Menara KL).
Towards this end, it has summoned three people over the transfer of the Menara KL concession to Hydroshoppe Sdn Bhd. In a statement today, the graft buster agency confirmed that the investigation was carried out after it found suspicion in the ownership transfer of the iconic building’s management.
Whatever said, TM issued a media statement today to clarify that it is exiting the concessionaire as part of its business transformation programme whereby it is focusing its efforts and resources to strengthen its core business of telecommunications and technology.
“After due consideration on the change in the business nature of Menara KL from telecommunications services to tourism and hospitality, TM has decided in October 2021 not to renew the MKL concession and informed the Government accordingly,” the national telco operator pointed out.
“Subsequently in 2022, the selection process of the new concessionaire was then taken up by the Government upon which TM was informed on the appointed company to take over the shares of MKLSB and the Menara KL concession.”
TM went on to say that MKLSB shall continue to operate the concession and ensure the continuity of Menara KL operations for the Malaysian public, including international visitors.
“Employees will remain employed with MKLSB under the new concessionaire for a minimum period of three years. This is to ensure their welfare is protected in this transition,” TM further noted.
It added: “TM practices good governance and transparency in our business undertakings to preserve the interest of our customers and stakeholders. TM will provide our full cooperation and disclosures as required by the authorities.” – Focus Malaysia
Meanwhile,the Malaysian Anti-Corruption Commission (MACC) has started a probe to investigate an alleged deal that saw the management ownership of the iconic KL Tower transferred from telecommunications company Telekom Malaysia to a lesser-known firm. The alleged deal was said to have happened before the 15th General Election (GE15) on Nov 19.
MACC’s chief commissioner Azam Baki was quoted as saying by The Malaysian Insight that his agency has opened the investigation papers on the sale of the KL Tower management ownership. Mr Azam, however, declined to reveal more information about the investigation, The Malaysian Insight reported on Thursday (Dec 29).
Allegations of Telekom Malaysia selling off its shares in Menara Kuala Lumpur - a subsidiary which manages the KL Tower – to a company called Hydroshoppe came to the fore in a series of tweets by a user that goes by the handle @FreeMsian. In the Twitter thread, the user alleged that Hydroshoppe was a firm with low paid-up capital, and yet was able to be involved in a deal that was worth millions of dollars.
According to checks by local media, Hydroshoppe is a firm based in Shah Alam, Selangor with a total issued share capital of RM1 million.The Twitter user further added that KL Tower was generating some RM66 million (US$15 million) a year in revenue before the COVID-19 pandemic, with a net profit of RM25 million, the New Straits Times reported.
The KL Tower belongs to the Malaysian government and serves as the broadcasting station for Radio and Television Malaysia (RTM) and FM-radio broadcasting, among others. On Tuesday, Communications and Digital Minister Fahmi Fadzil said that he takes the issue of KL Tower’s management transfer seriously after the allegations about the deal were surfaced to him.
In a statement, Mr Fahmi said that his ministry will monitor the issue and will give its full cooperation with the authorities should there be any investigations. “I was given a detailed briefing on the concession of KL Tower’s management by the Communications and Digital Ministry on Dec 14,” he said, adding that he will next be briefed on the issue by Telekom Malaysia on Jan 3 next year.
Separately, former communications and multimedia minister Annuar Musa (above) denied that he had anything to do with the transfer of shares from Menara Kuala Lumpur to Hydroshoppe.
Mr Annuar was quoted as saying by the New Straits Times that Telekom Malaysia is a publicly listed company and was not under the purview of his then-ministry.
“Nothing to do with the communications minister. Go ask (Telekom Malaysia) …,” Mr Annuar was quoted as saying to news portal Malaysiakini. - - CNA
In the month before the general election when the government was turning into caretaker mode, a profitable public asset, the KL Tower was stripped from public ownership and discretely sold off to private interests.
According to a Twitter account FreeMalaysian, dedicated to highlighting corruption, in the month before the general election, the KL Tower concession was quietly sold off to a company about to be struck off the Registrar of Companies (ROC),Hydr...ppe ..
KL Tower is a government asset of T...kom Malaysia, a government owned company or GLC holding a concession to the tower and the rights to commercial activities therein. KL Tower operations achieved RM66 million per annum before the pandemic, where RM 25 million net profit was achieved. With the pandemic effectively over, those sort of revenue and profit figures are achievable once again.
Ten million shares of M...a KL Sdn Bhd, the concession operating company for T...kom Malaysia Bhd, were sold to Abdul H...d Sh..h Abdul R..k Shaikh and N...ina Binti M....ed N...r. These two people are the directors of Hydr...ppe in a transaction dated 31st October 2022.
This transaction selling off public assets to private citizens raises a number of questions???
Why would a public asset be sold off without any announcement just before a general election when the executive government was entering caretaker mode?
Why had T...kom Malaysia made no public announcement?
Why is T...kom Malaysia selling off a profitable asset?
This on the face of it appears to be a clandestine sale of public assets to cronies before the election. The T...kom Malaysia integrity officer who was also an officer of the Malaysian Anti-Corruption Commission (MACC), Abdul Razak Deroaf is totally silent on the issue, that should have raised ‘red flags’.
The nominee directors of M... KL Sdn Bhd, the concessionaire company, Tengku M...r Bin Tengku M...i and R...an Bin G...li indicates that senior management of T...kom Malaysia were fully aware of the transaction and the implications. Tengku M...r is T...kom Malaysia’s chief strategy officer, while R...an is the group chief financial officer.
This is a scandal of the highest order, which shows that cronyism and corruption is rife within GLCs. This is only one case the public has been alerted to. GLCs are havens of corruption.- Syed Akbar Ali
Mereka ahli Bersatu bertanding atas tiket GRS berbeza dgn ahli Bersatu bertanding atas tiket PN. Paling mustahak adalah kena lihat sapa yang sign watikah pencalonan. Umum mengetahui Muhyidin ketua PN bukan GRS. Jadi siapa ketua GRS? Hajiji?