By DASHVEENJIT KAUR/ Pic By HUSSEIN SHAHARUDDIN
Datuk Zakaria Arshad will resume his duties as Felda Global Ventures Holdings Bhd (FGVH) group president and CEO on Oct 16, 2017, 133 days after he was asked to go on leave following a domestic inquiry (DI) over a subsidiary’s deals.
The plantation company said that the DI has been carried out with proper internal processes consistent with Ministry of Finance Inc’s (MoF) requirement that the process must be carried out with integrity, spirit of impartiality and ensuring proper corporate governance.
“After taking into consideration the ongoing FGVH transformation programme and group president/CEO’s commitment and assurance to resolve the long outstanding debt of Safitex Trading LLC, the MoF would like Zakaria to return as the group president and CEO,” FGVH said in a statement yesterday.
The company said the findings of the DI were submitted to the MoF in line with Article 80 of FGVH’s memorandum and articles of association and the MoF took time to review before making its decision.
In June, Zakaria, along with FGVH’s group CFO Ahmad Tifli Mohd Talha and two other senior management officials were told to take a leave of absence following a DI over Safitex Trading’s debt.
Ahmad Tifli and two other senior management staff had returned to work last week.
FGVH then chairman Tan Sri Mohd Isa Abdul Samad has asked the four to go on leave pending a DI over the debt issue.
External auditor PricewaterhouseCoopers discovered some alleged discrepancies in the dealings between Delima Oil Products Sdn Bhd, a subsidiary of FGVH, and Dubai-based Safitex Trading, which led to the DI.
FGVH, the world’s second-largest initial public offering in 2012, has been struggling to return to its listing price following the drop in crude palm oil price. Management conflicts has not helped one of the world’s largest palm oil company.
Share price of the company has been fluctuating between RM1.53 and RM1.84 since Zakaria was asked to go on leave. During the period, the government has appointed Datuk Wira Azhar Abdul Hamid as the chairman to replace Mohd Isa.
Meanwhile, Azhar reiterated his commitment to turn around and bring the company to greater heights despite the various challenges faced at this point in time.
“My immediate priorities are to improve operational and financial performance of our core business and ensure sustainable growth going forward.
“Being one of the biggest palm oil plantation companies, FGVH must aspire to be the industry leader in terms of productivity and financial returns, so any factors hindering us from achieving these objectives must be addressed immediately,” Azhar said in a statement.
He said that there is a need for a new management structure to strengthen the organisation going forward and to provide better focus towards achieving FGVH’s strategic plans.
“The board composition will also be enhanced with the appointments of subject matter experts,” he said, adding that the new appointments will be made in due course.
According to Bloomberg data, FGVH is trading at 143.3 times, trailing 12-month earnings per share and 54 times its estimates for the coming year.
The analyst consensus rating is equivalent to ‘Sell’ and the stock has returned 12% so far this year and a loss of 25% in the past 52 weeks.
As of yesterday’s closing, FGVH closed one sen higher at RM1.72, giving it a market capitalisation of RM6.27 billion.