by AFIQ AZIZ / pic by RAZAK GHAZALI
THE consolidation of all commercial entities under Majlis Amanah Rakyat (Mara) to Mara Corp Sdn Bhd could face delay, as the agency is “taking its time” to transfer all of the related assets into the investment holding firm, said Mara Corp chairman Akhramsyah Muammar Ubaidah Sanusi (picture).
Akhramsyah told The Malaysian Reserve (TMR) the move is not going at a “desirable pace” as substantial assets amounting to about RM400 million are held by 10 Mara-owned companies.
“As such, I am seeking clarification and ask for Mara to execute this transfer because it is to ensure full compliance with the Ministry of Finance’s (MoF) instructions and in line with good governance practices set by the government,” he said in an exclusive interview last week.
The transfer was instructed by the MoF, aimed to improve corporate governance, as government agencies are not meant to carry any commercial risk, directly through subsidiaries that participate in commercial business.
“So, we are hopeful that the asset transfer will happen quickly, not only because the longer we wait more difficult of our intervention would be, but also because we have a tax exemption period given by the ministry, expiring until the end of this year.”
“This stamp duty tax exemption is worth more than RM10 million and we do not want to just waste that kind of amount unnecessarily,” Akhramsyah said.
According to the chairman, a bulk of strategic assets — mainly owned by Universiti Kuala Lumpur (UniKL) — which has about 22,000 students and 13 campuses remains under Mara. According to him, the figure excludes land valuation.
“These institutions are private educational institutions, thus it has commercial risk.
“These are direct commercial liabilities potentially against Mara. The existence of Mara Corp is to protect Mara from that, however, these assets and many others like them have not been transferred across,” he added.
Akhramsyah was expecting entities like UniKL to cross over by the first quarter of this year.
Formed in 2016, Mara Corp was tasked to manage and develop all Mara’s commercial entities under its umbrella, a way to reduce the government risk in managing commercial entities.
Akhramsyah said Mara Corp is valued about half a billion of ringgit as of December 2018, with eight of 18 companies were already moved to the corporation.
In February, TMR reported that eight subsidiaries were transferred to Mara Corp including Permodalan Mara Bhd, Mara Inc, Glocal Link, Mara Aerotech and Asia Aerotech and Rural Capital Bhd (RCB).
Citing RCB as an example, Akhramsyah said since the transfer, the firm has recorded a tremendous result by recouping RM1.5 billion worth of debt, which previously failed to be recovered by the Rural Development Ministry’s agency.
In total, Mara Corp is expected to generate profit before tax by the end of this year, reaching about RM20 million, from the RM74 million losses in the year before, Akhramsyah said.