KUALA LUMPUR: PT Rajawali Capital International has no financial capability to repurchase PT Eagle High Plantations (EHP) even though the Federal Land Development Authority (Felda) has activated the put option to sell its stake in the Indonesian plantation company.
Economic Affairs Minister Datuk Seri Mohamed Azmin Ali said this was based on Rajawali Capital’s move to reject Felda’s proposal early this year.
“This proves that they do not have the financial capability to pay back the amount invested by Felda,“ he told reporters after winding up the White Paper titled “Towards Felda’s Sustainability” in the Dewan Rakyat today.
Earlier in his winding up speech, Azmin said Felda’s previous administration failed to conduct due diligence on Rajawali Capital.
“When we investigated Rajawali Capital’s financial position, (we found out) that it is a private asset which only has net tangible assets totalling US$7.2 million,“ he said.
Felda, through its subsidiary, FIC Properties Sdn Bhd signed an agreement to purchase a 37% stake in EHP from Rajawali Capital for US$505.4 million in 2016.
The agreement included the put option which allowed Felda to sell the stake back at the original purchase price with a 6% annual interest charge to be borne by the Indonesian company. — Bernama