Mem­bers con­cerned over sale of AAM HQ

> Sale price, lease-back agree­ment and ap­point­ment of agent among is­sues


MEM­BERS’ con­cern over the sale of the head­quar­ters of the Au­to­mo­bile As­so­ci­a­tion of Malaysia (AAM) ap­pears to be jus­ti­fied.

It is just one of the last prop­er­ties the AAM owns.

While the sale may be jus­ti­fied on the ba­sis that the money could solve its on­go­ing cash-flow prob­lems, the whole process of this trans­ac­tion raises a cloud of sus­pi­cion.

Even be­fore mem­bers can ap­prove its sale at the spe­cial gen­eral meet­ing (SGM) set for Oct 3, news has emerged that the deal has al­ready been fi­nalised and that the earnest money of 10% of the sale price of RM7.5 mil­lion has been re­ceived by AAM. The only res­o­lu­tion the SGM seeks is for mem­bers to au­tho­rise the trustees and/or the as­so­ci­a­tion to ex­e­cute all doc­u­ments as may be nec­es­sary to ef­fect the said sale to ful­fil its obli­ga­tions un­der the sale-and-pur­chase agree­ment.

How­ever, as early as May 3, AAM vice-chair­man Wan Za­harud­din Wan Ah­mad, had al­ready of­fered the prop­erty for sale to WWRC Hold­ings Sdn Bhd, a chem­i­cal so­lu­tions com­pany with Sin­ga­porean and Tai­wanese di­rec­tors. That’s not all. It has also en­tered into a lease-back agree­ment with the buy­ers for 12 years with the to­tal rental amount­ing to RM5.85 mil­lion. The lease­back ar­range­ment guar­an­tees the pur­chaser a 12-year rental re­turn rang­ing from 5 to 8% per an­num.

So, af­ter that pe­riod, the net gain for AAM would have been RM1.85 mil­lion with­out hav­ing own­er­ship of the build­ing.

Six days af­ter the of­fer let­ter was sent, Wan Za­harud­din sent a let­ter of ap­point­ment to a char­tered ar­chi­tect, Yong Sow Wai, to act as mar­ket­ing agent for the sale. “If the al­leged sale had al­ready been ne­go­ti­ated and an of­fer let­ter al­ready made, why ap­point a mar­ket­ing agent?” asked one mem­ber.

Other mem­bers claim that the build­ing is be­ing sold at be­low the pre­vail­ing mar­ket price. AAM, in its own doc­u­ments, re­vealed that the prop­erty – 10 shop lot units op­po­site the Sul­tan Ab­dul Aziz Shah Golf Club – was val­ued at a much higher price.

Raine & Horne In­ter­na­tional Zaki and part­ners put the price at RM8.6 mil­lion. Rahim & Co In­ter­na­tional val­ued it at RM7.7 mil­lion.

It is not known if the sale was made through an agent or through a ten­der ex­er­cise, but the com­mit­tee in its min­utes noted that the “best of­fer” was RM7.5 mil­lion.

We con­tacted both Wan Za­harud­din and AAM chair­man Tengku Mudza­far Tengku Mustapha last week for com­ments.

We were sub­se­quently con­tacted by AAM’s solic­i­tors to pro­vide an­swers.

How­ever, the solic­i­tors could not pro­vide the an­swers sought and a part­ner of the le­gal firm replied: “Your queries are not all le­gal in na­ture. I can re­spond eas­ily to the le­gal as­pects but (some) ques­tions are not within my purview and I have to seek in­struc­tions on that.”

Ex­cerpts of the let­ters sent to the ar­chi­tect and WWRC Hold­ings.

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