Najib defends Bakke’s appointment at Sime Darby

(NST) KUALA LUMPUR, June 19 — Datuk Seri Najib Razak insisted today Datuk Mohd Bakke Salleh was the right man to helm Sime Darby Berhad despite criticisms about his previous track record at Felda Holdings Bhd.

The Felda Holdings group managing director succeeded Sime Darby’s top executive Datuk Seri Ahmad Zubir Murshid after the latter was asked to go on leave a month ago following costs overruns from the Bakun dam project and another energy project in Qatar.

But complaints about Felda’s depleting cash reserves have surfaced following Bakke’s appointment to Sime Darby.

“If we look at his track record, Datuk Bakke has the ability to improve Sime Darby,” Najib told reporters today.

The government had recently admitted that Felda’s cash reserve fell from a high of RM4.08 billion in 2004 to RM1.35 billion in 2009, a decline of 67 per cent.

Pakatan Rakyat leaders have blamed Najib and Bakke for Felda’s dwindling cash reserves, with former Land and Co-operatives Deputy Minister Datuk Dr Tan Kee Kwong alleging that the decline took place when the two men took over.

On the other hand, the troubled Sime Darby reportedly suffered losses amounting to more than RM1.7 billion from the mismanagement of four oil and gas projects, namely the Bakun dam, QP, MOQ and Marine projects.

In his filing to Bursa Malaysia, Sime Darby chairman Tun Musa Hitam had said that Bakke was chosen for his proven track record in managing large corporations, necessary experience in corporate restructuring exercises as well as management expertise in the plantation and property industries.

It is understood that Bakke’s appointment had met some resistance from veterans in the Sime Darby group, who generally do not like outsiders helming the organisation.

Sources said the Islamic banker will have a major job of winning over staffers of the plantation-to-power conglomerate apart from dealing with a chairman and board which have been tarred by the financial fiasco that felled Zubir.

The Malaysian Anti-Corruption Commission (MACC) started investigations into Sime Darby last month, beginning with a probe on the conglomerate’s internal inquiry, believed to have started nine months ago, to determine the real extent of the losses in the energy and utilities division.

“It was not a hurried decision because (the board)’s internal evaluation (of Bakke) has been done together with a third party,” said Najib in reference to Bakke’s appointment five days ago.

While no timeframe has been determined for Bakke to start at Sime Darby, Musa had said it would be possible for him to join even before Zubir’s contract ends in November.

Bakke is the group president and chief executive officer of Felda Global Ventures Holdings Sdn Bhd (Felda Global).

The 56-year-old was also the group managing director of Felda Holdings, group managing director and chief executive of Lembaga Tabung Haji, and has served as the director of the Property Division of Pengurusan Danaharta Berhad.

Bakke has also served in several companies within the Permodalan Nasional Berhad group.

Musa had said that he and the board of directors could ultimately be held accountable for the losses and the forensic audit being conducted by Deloitte and KPMG could implicate the board.

The third phase of the forensic audit is ongoing and is expected to be completed by August after which decisions will be made on what actions needed to be taken, the board said.

The huge losses of Sime Darby together with another GLC, Pos Malaysia Berhad which has incurred losses amounting to RM227 million over the past three years, have caught the attention of the Parliament’s Public Accounts Committee.

The committee had announced that it would haul up the management of both companies to explain the losses.