“Isa Samad has caused a RM1.1 billion loss in FGV’s share price by triggering the boardroom tussle. Further to that the Felda settlers hate him and, according to Pakatan Harapan, Umno is going to lose big-time in the Felda seats as long as Isa Samad is still around. Isa Samad is actually angry with Shahrir Samad who he feels is by-passing him and is interfering in FGV. That is why Isa Samad wants those he perceives as Shahrir’s ‘eyes and ears’ out of FGV. Basically Isa Samad has launched a turf war against Shahrir”
THE CORRIDORS OF POWER
Raja Petra Kamarudin
The hot issue this week is regarding the boardroom tussle in Felda Global Ventures Holdings (FGV), a wholly-owned subsidiary of Felda. This was blogger LSS’s comments on the matter:
FGV has 3.65 billion issued shares. On Monday, its share price was RM1.82. Yesterday, when it was officially announced that it had suspended the CEO, the CFO and two other executives, FGV’s share price immediately dropped 31sen to as low as RM1.51 before recovering to RM1.62 (down 20 sen). A 31sen loss per share equals to a RM1.1 billion loss of FGV’s market value. A 20sen loss equals to a loss of RM730 million
According to news report, the delay (not loss) in payment from the long-time customer from Afghanistan is 0.2% of FGV’s RM17.3 billion revenues for 2016 – or about RM34.6 million. Because of a RM34.6 million delay in payment from a long-time customer, you caused up to RM1.1 billion drop in market value and caused longterm damage to your listed company’s reputation with to-and-fro accusations between the Chairman and CEO of all sorts of impropriety? What smart people that they have in FGV’s board of directors.
LSS thinks it is silly to quarrel over a RM35 million delay in payment from a longterm customer and trigger a RM1.1 billion loss in the company’s market value (compounded by the allegations and counter-allegations of impropriety). Of course, that would be true if the RM35 million delay in payment was the real reason. But then this is merely an excuse to get rid of the company’s President and CEO. It is not the real reason.
Malaysia Today has already written about this in great detail, which you can read here:
FGV’s Chairman, Mohd Isa Abdul Samad, is not happy with the company’s CEO, Zakaria Arshad. So he used the RM35 million delay in payment as the excuse to ask Zakaria to resign. Zakaria, however, refused to resign so Isa Samad brought the matter to the Board and asked the Board to sack Zakaria. Zakaria, in turn, alleged that there are many transgressions in the company and he invited the MACC to conduct an investigation into some of these corrupt acts. The MACC has already met Zakaria to get more information about these allegations.
Felda has been on the radar screen for some time (which was why Shahrir Samad was appointed the new Chairman to replace Isa Samad). In fact, PPBM a.k.a. Pribumi is confident that they can win most of the Felda seats because many Felda settlers are very unhappy with Isa, according to PPBM. And if Umno loses the Felda seats that means Barisan Nasional is going to lose the next general election and Pakatan Harapan is going to get to form the new government.
Hence this is not just about FGV or Isa Samad. It is about the future and survival of Umno and the entire Barisan Nasional. Handle the FGV matter wrongly and Prime Minister Najib Tun Razak might as well start packing his bags. That is how crucial Felda is to the future of Umno and Barisan Nasional. Najib should consider throwing Isa Samad to the wolves and save Umno rather than gamble away Umno’s future on a man who in 2005 was suspended from the party for corruption.
Isa Samad was demoted when Shahrir Samad replaced him as the Felda Chairman in January this year, which was a slap on Isa Samad’s face. As the non-executive Chairman Isa could only chair the board meetings and had no real executive powers in FGV. The company’s CEO, Zakaria, then started interacting with the chairman of Felda, that wholly-owned FGV anyway. And this upset Isa Samad.