Prasarana chairman clarifies that all actions taken against the ex-president and CEO are done according to procedure
by AFIQ AZIZ / pic by BERNAMA
PRASARANA Malaysia Bhd chairman Datuk Seri Tajuddin Abdul Rahman (picture) said the suspension of Muhammad Nizam Alias as the company’s president and group CEO is due to misconduct and insubordination.
Tajuddin also clarified that all actions taken against Muhammad Nizam were done according to the proper procedure.
The Pasir Salak MP, however, declined to elaborate on the matter as domestic investigation is still ongoing.
“On Nov 27, the board member had asked Muhammad Nizam to go on leave. He has been sent a show cause letter, which he had replied within the stipulated time.
“To be fair to him, and to follow (good) governance and procedure, the board has decided to form a small committee to further investigate and decide on this matter,” he said in a packed press conference yesterday.
Prior to this, several media had reported that Muhammad Nizam was asked to vacate his post due to his reluctance to follow Tajuddin’s instruction as the chairman.
“We cannot reveal further as the committee will only convene their meeting this month,” Tajuddin said, refusing to divulge on why Muhammad Nizam was suspended.
A local daily reported that Tajuddin has exerted his authority as he had sought to terminate the contractors of the transport-oriented development at the Dang Wangi light rail transit (LRT) station, which in return will have Prasarana to compensate a sum of RM80 million to terminate the joint land development agreement.
Among others, the report also stated that Tajuddin’s family is expected to benefit from the termination, as one of the companies — Tindakan Juara Sdn Bhd — is owned by his family.
“This project was awarded in 2012 before I became the deputy minister in 2013, and I have already disposed of my interest. So, no conflict of interest arises,” said Tajuddin.
The project, named Latitud 8, includes public-listed Crest Builder Holdings Bhd and its 51%-owned unit, Intan Sekitar Sdn Bhd.
The remaining 49% of the company is held by Detik Utuh Sdn Bhd. Tindakan Juara has 40% of shares in Detik Utuh. It was reported that development had already commenced works on the main building.
“It was just one of the proposals that arose in the board meeting as the property market is very soft and is not viable. We aim to relocate our headquarters here in the golden triangle instead of Subang.
“But I did not pursue anything on this project,” he explained.
On allegations that Tajuddin is withholding the payment of LRT3 project to its turnkey contractor, MRCB-George Kent Sdn Bhd (MRCB-GK), he said the Minister of Finance Inc subsidiary has already paid RM3.47 billion of progress payment to MRCB-GK, while only RM380 million is pending according to the October and November 2020 invoice.
It was previously reported that 17 subcontractors and consulting firms for the LRT3 project jointly wrote a letter to Prime Minister Tan Sri Muhyiddin Yassin, the Ministry of Finance and Ministry of Transport to seek help for payment of more than RM700 million withheld by Prasarana for work done.
“But this payment is pending from MRCB-GK to its contractors, not from us,” added Tajuddin.
“I also did not withhold the payment as those payments are being approved by the Prasarana management, not me. I only advise them to do so because of our cashflow.
“As of now, we have about RM2 billion. We have to serve the sukuk service of RM650 million.
“Furthermore, we are having a shortfall of RM200 million to bear the fall in ridership revenue due to Covid-19. After we serve the capital expenditure of RM350 million, so we are only left with RM844 million.
“So, we need to be prudent before the shareholders — the government provides us with funds.
“Recently, RM1.5 billion of government sukuk has been approved, but the money will only reach within the next three months,” Tajuddin said.
Tajuddin said MRCB-GK should have enough capital to run for the mega projects, instead of relying on progress payment from Prasarana.
He also did not deny the possibilities to “restructure” the package, if MRCB-GK could not handle the project accordingly.
Prasarana officers also confirmed the firm has run the valuation of George Kent (M) Bhd’s capability to be part of the joint venture with an accounting firm appointed for the valuation process.
Meanwhile, in a separate statement MRCB-GK said Prasarana’s payments on Oct 2, 2020, were for construction works done ended June 2020.
“Prasarana’s delayed payments of more than RM700 million were from July 2020 to October 2020, which have been certified for payment by Prasarana’s appointed independent consultant, KL Prima Consult Sdn Bhd,” it said.
As of October 2020, the certified payment amount was RM723.89 million, while November 2020 payment is still pending certification.
Read our earlier report