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Time dotCom IPO Bailout: What Can The People Do?
By Kim Quek
23/3/2001 7:10 pm Fri
[Isu Time dotCom adalah skandal terbaru untuk menyelamatkan kroni
dengan menggunakan dana awam yang berselindung disebalik tabir penjamin
(underwriter). Tiada alasan munasabah diberikan untuk memilikki saham
yang begitu teruk jatuh nilainya itu sebagaimana yang diramalkan oleh
MAJORITI pakar dan analis. Padahal ada banyak lagi saham yang lebih
menguntungkan di BSKL jika kempunan sangat mahu untung membeli. time
dotCom adalah syarikat yang tidak pernah untung sama sekali, sebaliknya
asyik berhutang tanpa henti.
Kini Halim sudah senang hati kerana sudah banyak hutangnya dibeli
(NSC: Danaharta beli, Renong: UEM beli, dan kini timedotCom: KWSP dan KWAP
'beli') tanpa dia perlu mencari ganti dari poketnya sendiri. Yang peliknya
mengapa KWSP menukar hutang kepada ekuiti - mengapa tidak diminta atau
ditunggu tunai sahaja?
Inilah akibatnya kerana terlalu percaya kepada kerajaan BN menguruskan
negara dan ekonomi. Mereka memperjudikan masa depan rakyat sehingga masa
depan warga tua pun diperjudi.
The various government explanations to justify the participation of
government controlled funds and agency in the IPO of Time dotCom have solved
one big puzzle. The puzzle at the launch of this IPO was: Why were all the
ten underwriting banks and security firms so foolhardy as to accept the
risks of underwriting the IPO when it was the unanimous opinion of the
market that the IPO price of RM3.30 per share was unrealistic and grossly
The truth has now emerged. These underwriters were mere camouflage. The
real 'risk takers' were the Employees Provident Fund (EPF), the Pension
Trust Fund (KWAP) and Danaharta (State Agency for restructuring NPLs of
banking institutions), who had collectively sub-underwritten from the
underwriters. In fact, the term 'risk takers' is a misnomer. It would be
more appropriate to call them 'loss takers', as it was already a certainty
well before the launch of the IPO (RM 1.89 billion) that it would be
rejected by the public and that whoever underwrote it would incur gross
losses. This was subsequently borne out by the fact that the IPO was almost
totally shunned by the public, while its share price plunged by one third
upon listing in the Stock Exchange.
And so once again we are witnessing another multi-billion ringgit government
bail out of a crony entrepreneur at grossly inflated price, ill disguised
this time as an IPO. The exception on this occasion was that the sources of
funds utilized to absorb these crony losses did not come from the government
coffers, but mainly from the savings of 9.7 million employees (EPF) and
850,000 public servants (KWAP). (The population of Malaysia is 22 million).
EPF and Danaharta explained that they were merely converting debt to equity.
Okay. But why agreed to convert at a price that none would accept as
reasonable? As for KWAP, who has taken the bulk of the under subscribed
shares, no explanation has been given.
The case of wrong doing by these government agencies is so clear cut that no
amount of explanations can white-wash the crime in massive squandering of
the sweat money of the entire working class of this Country. The big
question now is: why did the management do it?
Could it be due to misjudgment? No chance, given that even the man in the
street could see that the offered share was not worth the price.
Could it have been motivated by personal monetary gain? Not likely. The
commitment to this IPO was so great and so obviously indefensible that no
reasonable personnel in the management would consider risking his neck,
without the orders from the very top.
Barring the above possibilities, what could have caused these raids on
public coffers other than the hidden hands of politics again? In this
respect, it is pertinent to take note that Time dotCom is owned by Time
Engineering , which in turn is owned by Halim Saad's Renong Group, which
has powerful connection with the ruling power.
Time Engineering had to settle a debt of RM 5 billions, for which it had
already obtained a cash infusion of over RM 2 billion from the Minister of
Finance Inc. earlier, and it now urgently needed the RM 1.89 billion cash
proceeds from the current IPO to meet its repayment commitment. However, no
one was prepared to pay for Halim's asking price, so what else can be done
other than dipping the fingers into government controlled pockets such as
EPF, KWAP etc?
The public may find this current bail out too enormous for comfort, but not
necessarily so to Halim, who has no doubt been accustomed to much bigger
bail out, such as the recent RM 3 billion write-off of his bad debt arising
from his misadventure in Philippines, and the RM 6 billion government take
over of the assets of the two debt ridden Light Rail Transit Companies
controlled by Renong. The combined figures of these bail out add up to one
fifth of the National Budget. Alternatively, if this amount is distributed
to the people, every family in this Country will receive RM 3,000. Imagine,
all these bail out within 6 months only, to a single crony!
And what did the Minister in charge, Finance Minister Daim Zainuddin had to
say on this latest bail out, the Time dotCom IPO scandal?
To the critics of EPF, he advised them to be 'serious and responsible and
not make wild allegations'. He further warned: 'the Government would not
keep quiet if there were efforts to tarnish its image and credibility'
(Star, 21st). So, instead of giving tenable rationale for EPF's
controversial action, as a Finance Minister should, he indulged in
To queries on KWAP's role in the IPO, he confirmed that KWAP had taken up
10.82% of Time doCom for RM 910 million as a sub underwriter, but he add 'I
have no idea how it became the sub underwriter. You should ask the KWAP
management' (Sin Chew Jit Poh, 21st). The Finance Minister's nonchalance
was shocking, when a major agency under his charge lost hundreds of million
of ringgit belonging to pensioners within a few days through apparent
criminal breach of trust, all he could do was shirking the shoulders.
Isn't the Minister ultimately responsible for such misdeeds? Is there any
sense of responsibility left in him?
Meanwhile, in the midst of this scandal, when none of the Barisan Nasional
Government leaders had given any answer remotely resembling an adequate
explanation, the Prime Minister was in his usual self, delivering his
bravado act during the Seminar on 'Integrity in Business: The Way
Forward'. He challenged critics of Malaysia's corporate governance to
conduct a comparative study with other countries. He claimed that
Malaysia's corporate governance was much better than other countries which
credited themselves with high standards of corporate governance.
In the face of such blank response from the BN Government to this blatant
breach of the people's trust, what can the people do? Report to the
police? Yes, this was done by the opposition DAP. But do not expect
anything will come out of it, as many many more of such police reports of
government misdeeds are still collecting dusts, without an exception.
Report to the Anti-Corruption Agency? None has done that yet, perhaps out
of the desire to save one's breath, knowing that ACA could be even more
impotent when it comes to high level crimes.
The people must really ponder, what can the people do?