Pelangi Prestasi cries foul over re-tendering of Sabah Forest Industries’ assets

The announcement of Pelangi’s takeover of SFI was made by the Sabah Chief Minister Tan Sri Datuk Seri Panglima Musa Aman at an event organised by Yayasan Sabah at the Esplanade, Sipitang, a day before the 14th general election. Source (pic): FMT

Pelangi Prestasi Sdn Bhd (PPSB) has expressed shock over the notice placed by Grant Thornton (GT) Malaysia in the Financial Times (FT) on the 9thof April 2019 inviting interested parties to submit acquisition offers for assets associated with Sabah Forest Industries Sdn Bhd (SFI).

SFI ran into problems early last year following a debt repayment exercise that forced the company to cease operations and left 1,500 employees in the lurch.

PPSB agreed to retain SFI’s existing workforce and gave its commitment to undertake the back wages of existing employees under a temporary layoff scheme.


Pelangi Prestasi Sdn Bhd (PPSB) has expressed shock over the notice placed by Grant Thornton (GT) Malaysia in the Financial Times (FT) on the 9thof April 2019 inviting interested parties to submit acquisition offers for assets associated with Sabah Forest Industries Sdn Bhd (SFI).

In a statement, PPSB said it had won the right to receive and manage SFI via an open tender similarly conducted by Grant Thornton Malaysia at a much earlier date.




The notice lists the key features of the sale as follows:

  1. ForestEstate(including288,000hectaresofforestresources)
  2. Pulp and Paper Plant
  3. Power Plant
  4. Integrated Timber Complex
  5. Jetty

The notification of PPSB’s successful bid was made in March 2018, while the Sale and Purchase agreement (SPA) pursuant to the bid was signed between PPSB and SFI in April 2018.

SFI ran into problems early last year following a debt repayment exercise that forced the company to cease operations and left 1,500 employees in the lurch.

PPSB agreed to retain SFI’s existing workforce and gave its commitment to undertake the back wages of existing employees under a temporary layoff scheme.

Upon winning its bid, PPSB paid 10% deposit (RM120 million) of the bid price (RM1.2 billion) to Grant Thornton as required and continued to perform its contractual obligations.

“There is no allegation whatsoever by SFI against PPSB of any breach of our contractual obligation.

“Furthermore, upon signing of the SPA in April 2018, PPSB has paid the salaries of the SFI staff in full, including the shortfall for the period of January 2018 – March 2018 arising from the temporary layoff program implemented by the Grant Thornton Malaysia, the Receiver in this matter.

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“PPSB firmly believes it has complied with all the conditions precedent within its ambit as set out in the earlier tender.

“The company has continued to act in good faith to ensure the timely completion of the SPA that was signed last year.

“This includes consistent engagement with Grant Thornton Malaysia to address any obstacles that may have been subsequently imposed towards successfully concluding the agreement,” the statement read.

PPSB is demanding transparency has since filed legal action to protect its interest.

“If there were new conditions imposed or variations to the original agreement, then PPSB demands transparency as to what those new conditions are, who requested its inclusion and when it was imposed

THE THIRD FORCE



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