Khazanah’s divestment made in ordinary course of business

KUALA LUMPUR: The ongoing transactions undertaken by Khazanah Nasional Bhd are in the ordinary course of its business which involves realising investments and then redeploying capital for new investments, said managing director Datuk Shahril Ridza Ridzuan.

Proceeds from the divestments are used to pay off Khazanah’s maturing debt and fund new investments, he said.

Repudiating accusations that the sovereign fund is selling off national assets and accumulating debts, Shahril Ridza said its focus in the near term is on delivering its strategic priorities as agreed by the board of directors.

On criticism that the Khazanah sales were ill-timed as the value of the assets had yet to be realised, he reiterated that the decision whether to divest or not is made after its investment targets are met.

“These are always made on a commercial basis. This means we will consider whether it would be better to hold the assets in anticipation of future dividends and increase in value or to sell and use the proceeds to make new investments,” Shahril Ridza said in an email reply to questions from Bernama.

There are also concerns that since it has been announced that the receipts from the assets disposal would be used to pare down the country’s debts, buyers may have the advantage in offering lower prices.

As Malaysia’s sovereign wealth fund, Shahril Ridza said, Khazanah’s main objective is to invest for the purpose of generating longterm financial returns. “following that, all opportunities for divestment are assessed on a case-by-case basis against our financial and strategic targets and will depend on the timing and strength of the market and also the availability, quality and credibility of buyers. — Bernama