Felda puts London property for sale as part of asset restructuring

KUALA LUMPUR: The Federal Land Development Authority's (Felda) is putting the Grand Plaza Serviced Apartments in London for sale as part of its initiatives to reorganise and restructure its assets in order to strengthen its financial position.

Its Chairman, Tan Sri Shahrir Abdul Samad said the decision was made following Felda's decision to dispose off assets that were not related to its core operations.

"I am convinced that the sale of this hotel is in line with Felda's direction to return to its core business and will have a positive impact on Felda's finances.

"This will also help Felda to focus on settlers' plantation management to ensure that they get a high income while ensuring their welfare and well-being are protected," he said in a statement today.

He was commenting on Member of Parliament for Pandan Rafizi Ramli's claim that Felda would not make a profit from the sale of the property.

Shahrir said that up to now, 54 parties had expressed interest in buying the Grand Plaza Serviced Apartments and the sale process is in the final stages where Felda needs to look into good and reasonable offers.

On Rafizi's claim of a mysterious operating expense of RM80 million, he said the allegation was baseless as the main component of the hotel's administrative expenses was the annual lease payments.

The lease rate is the rental fee that needed to be paid by FIC Grand Plaza Ltd, a company that manages the business on behalf of its parent company, Felda Investment Corporation (FIC) UK Properties Sdn Bhd (Felda's investment arm).

He said Felda is a statutory body with its own income and financial resources without obtaining financing from the federal government since 1996.

"This means that Felda's operations are not directly tied up to taxpayers or settlers," he said, rebutting Rafizi's allegation that the agency could lose millions from the sale of the Grand Plaza Serviced Apartments and the purchase was made through a loan from the Employees Provident Fund.

On the contrary, the property was acquired through the listing of Felda Global Ventures Holdings Sdn Bhd in 2012 using Felda's internal funds and the agency did not incur any interest payment costs, he said.

Shahrir said besides asset restructuring, Felda's financial restructuring and strengthening measures would result in cost savings and enhancing internal capabilities, getting a federal fund for infrastructure projects in Felda land schemes, as well as restructuring existing loans. — Bernama