Monday, July 09, 2012

Selangor Did Not "Overpay" for Talam Land

Datuk Chua Tee Yong had on 5th July 2012 claimed that the Selangor state government has “overpaid” for a piece of land taken over from Talam Corporation Berhad.  This piece of 2,263.53 acres of leasehold land in Bestari Jaya was valued at only RM139.09 million by an independent professional valuer although the State government had valued it at RM181.08 million.  Hence the accusation that Selangor has overpaid by RM41 million.

Datuk Chua’s accusation is not only cheeky, it is deliberately misleading by using selective statistics. Just as there were some pieces of land which the valuer Mitra Valuers & Property Consultants Sdn Bhd had valued lower than the state valuation, there were also many other pieces of land which was valued higher than the state valuation.

For example, the state government valued a 341acres piece of Bukit Beruntung 2 freehold land at RM89.1 million, Mitra had valued the same piece of land for RM100.8 million or RM11.7 million “gained” by the state.

Similarly, another piece of land, 686.93 acres of Bukit Beruntung 2 freehold land was valued at RM179.5 million by the state, but was valued by Mitra to be much higher at RM198.9 million. That’s a “gain” of RM19.4 million to the state.

Why did Datuk Chua Tee Yong not praise Tan Sri Khalid Ibrahim for his astute business sense over these pieces of land?

What is important however, isn’t whether each of these 13 pieces of land taken over from Talam Corporation are valued higher or lower than the independent professional valuer.  What is important is that the overall value of all 13 pieces of land taken over by the state as settlement for the Talam debts are fair in value.

In this case, the state has measured the combined value of these parcels of land to be RM676.1 million.  However, the very same Mitra Valuers had valued these 13 parcels of land to be worth RM685.2 million, which means that they are worth more than the value the state has attached to these properties!

In fact, despite many of these properties having been acquired in the 1990s, the book value of these properties in Talam’s financial statement is an even higher figure, RM690.2 million. This means that the state government got these pieces of land at a RM14.1 million discount to Talam’s book value of these assets.  The above information is publicly available on Bursa Malaysia, in the Circular to Shareholders on the Debt Settlement Proposal issued on 15 March 2011.

Datuk Chua in his anxiety to discredit the Selangor state government has completely missed the woods for the trees.  Or he has decided to shoot blindly, before he was able to obtain all relevant information.

As an accountant, Datuk Chua should be giving praise to the Selangor state government for not only being able to recover all its RM392 million debt with Talam, it was able to do so by taking over assets at a lower value that what they are worth as measured by an independent professional valuer, accepted by the Securities Commission!

It would perhaps be more productive for Datuk Chua to scrutinise the other land transactions which took place during the Barisan Nasional (BN) administration where state land was alienated to their cronies at prices way below market value.

Can Datuk Chua investigate or explain how the Tanjong Karang Umno Division paid a premium of only RM130,244 for a piece of 1.2ha commercial land in April 2002 despite the market valuation by the state government being fixed at RM3.3 million?

Or can Datuk Chua demand accountability and transparency from the former BN state government for alienating another piece of land to Tanjong Karang Umno Division for only  RM47,039 when the 0.437ha land is worth more than a million ringgit based on the state’s own valuation?

These dodgy land deals have been exposed by the DAP Sekinchan state assemblyman in the last 2 days. They proved that while the Pakatan Rakyat government seeks to maximize returns to the rakyat by securing more than what is valued, the BN government was the complete opposite by giving away enormous premium discounts to its cronies.

We have over the last 2 days responded to and refuted every single one of Datuk Chua Tee Yong and the Selangor MCA leaders allegations.  None of their accusations of abuse could hold any water.  Hence it is time for Datuk Chua and his cohort to be brave and courageous in facing up to their mistakes, publicly concede that they were mistaken and apologise to the Selangor state government for tainting the good name of the Pakatan Rakyat Selangor government.
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