Why the PM should scuttle the coming FGVH IPO

— Lim Teck Ghee
The Malaysian Insider
May 18, 2012

MAY 18 — Prime Minister Najib Razak last week announced a “windfall” of RM15,000 to each Felda settler family.

The planned payout is to come from the initial public offering of the Felda Global Ventures Holding (FGVH). As part of the IPO of FGVH, Felda will be disposing 1.21 billion of its current FGVH shares at RM4.65 each, and from which Felda stands to make RM5.62 billion if these are fully taken up.

Among the targeted anchor investors are Employees Provident Fund (EPF), Permodalan Nasional Berhad (PNB), Lembaga Tabung Angkatan Tentera (LTAT) and other national and Bumiputera funds.

Ahead of the share sale to be held by June, Felda settlers have been given an assurance by Najib that the listing would yield profits. He had also lashed out at those opposed to the scheme, saying that they are merely trying “to confuse” the people.

At this stage it is not clear yet who is trying to confuse the settlers or other Malaysians since the planned IPO is a highly complicated transaction whose full details have not been thoroughly unravelled and evaluated by professional market analysts. This is because many analysts are fearful that they may antagonize the government and end up on the wrong side of the authorities.

Felda accounts for around 18 per cent of the country’s total palm oil output. The idea behind FGVH is to turn this newly created corporate entity into a “global conglomerate”.

The blogger Pirates of Putrajaya, who is one of the few to have studied the considerable documentation pertaining to the IPO, explains that what FGVH is offering to the public is its 49 per cent interest in Felda Holdings, of which 51 per cent is owned by Koperasi Permodalan Felda Malaysia Bhd (KPF) and its one golden share held by the Ministry of Finance.

More illuminating examination of the convoluted deal is to be found in the Pirates of Putrajaya blog.

With such a huge amount of newly-minted money in the works, it is only natural that the FGVH listing should be subject to scrutiny with regard to its political and socio-economic implications.

One is that the Felda folk are a vital constituency numbering 112,635 settlers who will be receiving payment as a “hadiah” timed coincidentally just before imminent elections.

Two, more important than the voter headcount, the so-called “windfall” for the settler electorate is to reinforce the political message that Umno has always taken care of the Malay rural constituencies.

Three, it is impossible to downplay suspicions that the purpose of the exercise is to fill the Umno war chest on the eve of an imminent election.

To read more on the financial repercussions on the Felda settlers in the long term, please go to the Pirates of Putrajaya website.

Even if readers are not convinced by the political analysis of blogger “Pirates”, it is clear that settlers are not getting the best deal out of this FGVH listing.

Why list FGVH and not FHB?

Felda Holdings Bhd (FHB), which is the entity that manages the oil palm plantations, is the jewel in the crown that makes most of the profits. (FY2010, it achieved net profit of RM614.2 million on turnover of RM14.9 million).

Felda’s plantations and related businesses are parked under FHB, which also manages some 355,000 hectares leased from Felda in addition to the 500,000 hectares belonging to settlers that it oversees.

FGVH is presently owned 100 per cent by Felda (i.e. the government) and its major source of profit contribution — i.e. 85 per cent of its earnings — comes from FHB.

KPF is owned by 220,000 stakeholders, of which half are pioneer settlers. KPF is therefore the vehicle where the interests of the settlers are in alignment.

FGVH also owns MSM, a listed refined sugar producer; Twin Rivers, a loss making investment in downstream oleo chemical companies in North America; and a joint venture business in the Middle East with IAATEC, in distribution of specialty fats.

Without FHB, the FGVH IPO will not fly.

In CPI’s opinion, the FGVH listing is less beneficial than listing Felda Holdings itself, which makes most of the profits.

Why shift profits into a company with poor performance and with no strong track record to justify a listing, and with the company belonging to the settlers getting the short end of the deal?

It would not only be simpler and more straightforward, but also commercially more logical and less costly to list FHB instead of FGVH, where KPF has a 51 per cent interest and FGVH has a 49 per cent interest.

Why is it necessary to do a swap when the bulk of the profit comes from FHB? The profits are in the upstream oil palm plantations, not the downstream oleo/specialty fats etc or refined sugar business that FGVH owns. The integrated strategy to justify using FGVH is just a distraction.

A successful listing of FHB would probably have at least as high, if not higher market capitalisation than that of FGVH, and will be worth more to the KPF stakeholders.

The better alternative is for the listing of FHB. Of course, if FHB were listed, most of the benefits would accrue to KPF and the settlers, and there will be no scope to use a vehicle like FGVH for potential ‘monkey business’ to benefit a horde of other interest groups.

Readers are reminded that there are 980 million shares on offer to the public. Of this 980 million, 286.8 million will be on offer to local/foreign institutional and selected investors, 419.5 million to Bumiputera institutions and selected Bumiputera investors approved by the Ministry of Trade and Industry, 200.6 million to eligible employees and 72.9 million to the Malaysian public.

How and to whom the bulk of these 980 million shares are allocated is where manipulation can take place.

In a nutshell, the FGVH structure would appear to be a lot less efficient in value creation for shareholders of FHB than just simply listing FHB itself.

There is no need to have another layer of management in FGVH, as well as going through all the costly and unnecessary restructuring that does not only fail to add value to the market capitalization but also does not maximize the value to KPF’s shareholders.

The settlers and stakeholders of KPF appear to be much worse off in agreeing to the deal, notwithstanding all the sweeteners. This is because we must ask the question of who will actually benefit from the FGVH listing. It is certainly not the settlers, especially if they could end losing a controlling stake in their jewel in the crown (Felda Holdings), in substitution for a minority interest in FGVH.

If the prime minister has been advised that the current listing is the best way to benefit Felda settlers, he has been wrongly advised. He needs to do a quick turnaround, scuttle the listing in the interests of settlers as well as in the national interest, and go back to the drawing board. — cpiasia.net

http://blog.limkitsiang.com/2012/05/19/why-the-pm-should-scuttle-the-coming-fgvh-ipo/

Tunku Aziz left DAP at own volition

DAP getting intensive flak from UMNO and its lackeys (utusan, perkasa), although it is quite clear that TA left on his own accord.

No leader castigated him or spoke ill of him, although TA claimed that Guan Eng was crude, unlike his father LKS, and probably because LKS said TA was a man of principle and integrity (before he jumped ship)

Going by the record, the first intimation of his intention to jump ship was when he opposed the Bersih 3 protest demo station on the grounds that violence would occur. By opposing, TR has gone against his principle of Transparency, because Bersih 3 was to fight for transparency in wanting clean, free and fair electoral reforms.

TR also forgot that past heroes like Mahatma Ghandi and Martin Luther King also led peaceful demonstrations in their struggle for justice and reforms.  They found nothing wrong with demonstrations.

A few days later, the BIG SURPRISE CAME.  TA made a startling declaration by calling  the people to support  PM Najib in his reforms to uplift the economy.

TA was recognised as the paragon of Transparency which opposed corruption and injustices. But, by calling for people to support Najib, he was publicly acknowledging that he approves the action of corrupt and racist leaders

The new TA declaration means  that he condones corruption and injustices, and he does not champion the ideals of Transparency anymore.  He has adopted the ideology of Najib

It is quite clear that TA has made a dramatic change in his career, and has rejected his former ideals of Transparency, by declaring open support for PM Najib who heads UMNO,  the repository of racialism, corruption and conspiracies.

Since TA has espoused PM NAJIB as his new master, it is natural that DAP and TA must part ways because DAP does not follow the ways of corruption, racialism and injustices.

Dr Chen Man Hin

Negeri royal demands Hisham’s exit

*This article posted in Free Malaysia Today here

Zefry Dahalan

 May 3, 2012

 Tunku Harmy says the Home Minister must take responsibility for the violence during the Bersih 3.0 rally.

SEREMBAN: A member of the Negeri Sembilan royal family has demanded the resignation of Home Minister Hishammuddin Hussein, saying he must take responsibility for alleged police brutality during the Bersih 3.0 rally last Saturday.

Speaking at the grand finale of the “Jelajah Jom Ubah Demi Rakyat Negeri Sembilan” ceramah series on Tuesday night in Seremban, Tunku Harmy Tunku Hannan said the police had no reason to turn violent.

He said he was at the rally from noon to 11pm.

“The environment was just like we were going for a picnic at Port Dickson,” he told the large crowd. “There were elderly people and children as well. I didn’t see any bad intentions among the protesters.

“Instead of protecting the protesters, the police became aggressive and beat the protesters just like a pack of wolves.

“Some people in Bersih T-shirts were wearing boots. This makes me suspicious.

“I can’t think of any other theory except that (the violence) was well planned. Hishammuddin must take the blame for the havoc and duly tender his resignation.”

Tunku Harmy also called Hishammuddin a traitor, alleging that he was responsible for allowing foreigners to hold Malaysian identity cards.

“It doesn’t matter whether the MyKad is genuine or fake. As the minister in charge of national security, he should take responsibility for letting things go out of control. The card is given to foreigners to (help BN) win the election,” he said.

“Go and check at Chow Kit Road, Selayang and other parts of Kuala Lumpur. There are countless numbers of foreigners doing business who have MyKads.”

Other speakers at the ceramah included Negeri Sembilan DAP chief Loke Siew Fook, state PAS chief Mohd Taufek Abdul Ghani and Rembau PKR chief Badrul Hisham Shaharin. But the star speaker was former information minister Abdul Kadir Sheikh Fadzir.

UN does not approve tear gas as a riot control agent

Dr Lin Mui Kiang
Letter
Free Malaysia Today
May 10, 2012

The United Nations in Malaysia would like to refer to the article published in The Star on May 7, 2012 titled ‘Police: Tear gas used at rally safe, UN-approved’. We very much regret that the UN in Malaysia was not consulted before the publication of this article as it contains serious inaccuracies.

The UN has consistently condemned the excessive use of force, including through the use of tear gas. Please also note that the Office of the UN High Commissioner for Human Rights (OHCHR) and Special Procedures of the Human Rights Council have on various occasions publicly expressed concerns about reliable reports indicating that civilians who died from tear gas suffered complications from gas inhalation, and that security forces have been firing metal tear gas canisters from grenade launchers into crowds.

The UN Special Rapporteur on Freedom of Expression after his mission to the Israel and Occupied Palestinian Territories (OPT) in December 2011 noted that “while the use of tear gas to disperse a crowd may be legitimate under certain circumstances, tear gas canisters should never be fired directly at demonstrators.”

Moreover, unlike what is alleged in the article, the UN does not set international standards on different kinds of irritants, nor has the UN approved ‘CS Gas’ as a ‘riot control’ agent.

As far as the use of force is concerned, the relevant UN instrument is the Basic Principles on the use of Force and Firearms by Law Enforcement Officials, which was adopted by the Eighth United Nations Congress on the Prevention of Crime and the Treatment of Offenders in 1990, not the Chemical Weapons Convention (CWC) of 1993. I provide its general provisions below:

1 Governments and law enforcement agencies shall adopt and implement rules and regulations on the use of force and firearms against persons by law enforcement officials. In developing such rules and regulations, Governments and law enforcement agencies shall keep the ethical issues associated with the use of force and firearms constantly under review.

2 Governments and law enforcement agencies should develop a range of means as broad as possible and equip law enforcement officials with various types of weapons and ammunition that would allow for a differentiated use of force and firearms.

These should include the development of non-lethal incapacitating weapons for use in appropriate situations, with a view to increasingly restraining the application of means capable of causing death or injury to persons.

For the same purpose, it should also be possible for law enforcement officials to be equipped with self-defensive equipment such as shields, helmets, bullet-proof vests and bullet-proof means of transportation, in order to decrease the need to use weapons of any kind.

3 The development and deployment of non-lethal incapacitating weapons should be carefully evaluated in order to minimise the risk of endangering uninvolved persons, and the use of such weapons should be carefully controlled.

4 Law enforcement officials, in carrying out their duty, shall, as far as possible, apply non-violent means before resorting to the use of force and firearms. They may use force and firearms only if other means remain ineffective or without any promise of achieving the intended result.

5 Whenever the lawful use of force and firearms is unavoidable, law enforcement officials shall:

(a) Exercise restraint in such use and act in proportion to the seriousness of the offence and the legitimate objective to be achieved;

(b) Minimise damage and injury, and respect and preserve human life;

(c) Ensure that assistance and medical aid are rendered to any injured or affected persons at the earliest possible moment;

(d) Ensure that relatives or close friends of the injured or affected person are notified at the earliest possible moment.

6 Where injury or death is caused by the use of force and firearms by law enforcement officials, they shall report the incident promptly to their superiors, in accordance with principle 22.

7 Governments shall ensure that arbitrary or abusive use of force and firearms by law enforcement officials is punished as a criminal offence under their law.

8 Exceptional circumstances such as internal political instability or any other public emergency may not be invoked to justify any departure from these basic principles.

We at the United Nations appeal to all journalists to correctly and accurately research and report all matters and procedures related to the UN. We believe that such professionalism should also extend to all public officials.

United Nations Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families

http://en.wikipedia.org/wiki/United_Nations_Convention_on_the_Protection_of_the_Rights_of_All_Migrant_Workers_and_Members_of_Their_Families

Irene Fernandez a true international champion of workers

Irene is the first human rights activist to voice the plight of foreign workers working in Malaysia

Her concern for exploited workers has prompted her to voice out, which no trade unionist has done has done

She might incur the wrath of local unionists, but her humanity and sense of justice has driven her to speak our for foreign workers.

Actually her attitude will win sympathy of countries which have workers here like Indonesia, Philippines, Bangladesh, Myanmar, Vietnam and Ceylon.

UN has formulated laws for countries which employ foreign workers prescribing rules for employers. Unfortunately, the government does not enforce the rules resulting in exploitation and maltreatment by employers and the whole chain of agents responsible in processing the foreign workers.

The concerns expressed by Irene Fernandez will hopefully result in better treatment of foreign workers, whose presence is vital for the construction, plantation and service industries.

Without foreign workers houses will not be built for our citizens. Without them, the oil palm plantations will stop producing palm oil which is a big money maker for our country, as 90 percent of workers come from Indonesia.

By speaking out for foreign workers Irene is now facing the wrath of MACC, die hard unionists and corrupt government officials.

Chen

Greetings for new DAP building in Penang

DAP PENANG STATE BUILDING IS A TRIBUTE TO PAST PARTY LEADERS WHO PAVED
THE WAY FOR DAP TO WIN IN PENANG

THE LAUNCHING OF A NEW BUILDING FOR STATE DAP IS A HISTORIC EVENT, AND
WILL BE AN INSPIRATION TO THE DAP MOVEMENT LED BY DEDICATED LEADERS TO
STRIVE HARDER AND ENSURE THAT THE DAP WILL HAVE A STRONG PRESENCE
THROUGHOUT THE COUNTRY.

It took many years of sacrifice and hard work to achieve put DAP to be in government of Penang.  the warriors of the early days  like PETER DASEN, GOOID HOCK SENG, TEOH TEIK HUAT and many others who shed tears and rivers of sweat to achieve the objective of capturing Penang.

Sdr Lim Kit Siang was the brains behind the campaign to capture Penang.  He fought and lost three times and lost three ties. Yet he never gave up.

The last charge in 2008 was made by Sdr Lim Guan Eng.  He took the challenge and he won the first time. FINALLY DAP BECAME THE GOVERNMENT OF PENANG..

NEVER GIVE UP.  The road ahead for DAP is full of challenges. Sdr  Lim Guan Eng knew he had a tough task ahead, which was to make Penang the model state that will implement the polices of a Malaysian Malaysia

As Penang Chief Minister, LIM Guan Eng  has literally worked miracles for Penang. His government is clean, efficient, liberal and corruption free.

His open tender system and a free market system have made Penang the first state government to have s surplus budget. He has scrapped the NEP policy, and foreign investment is queuing up in droves to invest
in Penang.

THE FUTURE.  THE FUTURE OF DAP IS LARGELY TIED UP WITH THE FUTURE OF
PENANG.  Penang under DAP is a success story.  Its success has embittered UMNO and its cronies are    determined to undermine the DAP government with lies, threats and malicious untruths. Penang DAP
must remain strong, and must counter the lies and fabrications of UMNO.

Under the leadership of Sdr Lim Guan /Eng, Penang DAP will become a shining example for the people of other states to vote for DAP to form their government.

PENANG DAP BUILDING WILL BECOME THE SYMBOL OF SUCCESS. 

THE NEW DAP building will serve as an example of how state governments should be run for the benefit of the people.  THE DAP BUILDING WILL BECOME THE SYMBOL OF A NEW MALAYSIA


DR CHEN MAN HIN

NAJIB FACES WORLD CONDEMNATION FOR BRUTAL POLICE OPPRESSION OF PEACEFUL PROTESTORS

Immediately after the Bersih 3 demonstrations were over the government media tried to portray Bersih 3 demonstrators

As unruly and violent.

However, events have shown that it is the police officers who battered peaceful demonstrators without rhyme or reason;

Police in uniform also assaulted both local and foreign reporters who were covering the demonstrators.  These shamely police brutality were captured in films, and are being shown live over world TV channels

The display of police assaulting innocent reporters and peaceful demonstrators will damage the image of Malaysia, and Prime Minster will have to explain to the world and account for the demeaning behavior of the police officers.

The world will compare notes. How is it  Egypt, Tunisia and Yemen large gatherings of people could mass together in city squares like the famous Tahrir Square of Cairo. No permits required.  No harassment by police.

In Malaysia,  police harass demonstrators in Kuala Lumpur.  Dataran Merdeka is off limits to demonstrators. In Cairo,Tahrir Square is open to demonstrators the year round.

POLICE BRUTALITY AND SUPPRESSION OF BASIC RIGHTS TO FREEDOM OF ASSEMBLY WILL DRIVE OFF INVESTORS. The irresponsible behaviour of the police will drive off foreign investors. They do not like to invest in countries where human rights are not respected.

PM Najib Rasak is urged to rethink his policies to freedom of assembly and the right to have freedom to clean, fair and free elections.  To condemn Bersih 3.0 is to deny the people the freedom to have clear, fair and free elections.

THE MESSAGE OF THE BERSIH 3.0 MASS RALLY IS THE RIGHT TO HAVE FREE, FAIR AND CLEAN ELECTIONS.  HE MUST IMMEDIATELY  CALL FOR THE ELECTORAL ROLL TO BE CLEANED UP, AND TO ENSURE THERE ARE NO PHANTOM VOTERS, NO FRAUDULENT FOREIGN VOTERS WITH VOTING RIGHTS, AND NO DOUBLE VOTING RIGHTS TO  ARMY AND POLICE PERSONNEL

HE MUST ALSO CALL FOR THE ELECTIONS COMMISSION CHAIRMAN TO RESIGN FORTHWITH AS HE IS RESPONSIBLE FOR ALLOWING THE ELECTORAL ROLLS TO BE FALSIFIED WITH ILLEGAL VOTERS.

Dr Chen Man Him

Dap Life Advisor