Felda be­gins as­set sale to cut debts

The Star Malaysia - StarBiz - - News -

KUALA LUMPUR: The Fed­eral Land Devel­op­ment Au­thor­ity (Felda), which is em­broiled in al­le­ga­tions of mis­man­age­ment and mount­ing debts, has com­menced the sales of non-strate­gic as­sets to ac­com­mo­date its li­a­bil­i­ties, says chair­man Tan Sri Me­gat Za­harud­din Me­gat Mohd Nor.

“We have started the process of sell­ing non-strate­gic as­sets both within and out­side the coun­try and this process will prob­a­bly run until the mid­dle or end of next year.

“It is hoped that the prices we get from the sales of these as­sets can ac­com­mo­date our li­a­bil­i­ties, as well as help ease the bur­den of set­tlers who are sad­dled with low oil palm prices,” he said on the side­lines of the Kolej Yayasan Felda’s con­vo­ca­tion.

Me­gat Za­harud­din said Felda has re­ceived enquiries from po­ten­tial buy­ers to pur­chase the as­sets but it was not ready to re­veal more in­for­ma­tion as the sales and pur­chase agree­ments needed to be ap­proved by the gov­ern­ment.

“We are fol­low­ing good gov­er­nance to make sure that we give equal op­por­tu­nity to the in­ter­ested par­ties. Those in­ter­ested must sub­mit their bids for the as­sets that they want,” he said.

In Septem­ber, Felda an­nounced the dis­posal of its as­sets, in­clud­ing ho­tels, apart­ments and a stu­dent hos­tel to­talling about RM2.2bil, which was ex­pected to help cut its debt to RM6.5bil by year-end from RM8.05bil debt recorded as at June 30.

Me­gat Za­harud­din said with this mea­sures in place, the gov­ern­ment agency would be on track to be­come prof­itable again and be able to turn around in at least the next two years.

He said the sales of as­sets were be­ing made to im­prove Felda’s cash­flow as it had taken a lot of loans from banks.

“So, we have to get a bit of cash­flow from out­side of what we nor­mally do that is through rev­enue from palm oil or debt re­pay­ment from set­tlers.

“We also have an SOP (stan­dard op­er­at­ing pro­ce­dure) where ev­ery set­tler earn­ing less than RM1,000 was al­lowed to de­fer their debt re­pay­ment to Felda and what­ever so­cial prob­lems en­coun­tered by the set­tlers, we will see how we can help them,” he said.

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