Sime’s ex-CEO’s case to open a can of worms
By The Malaysian Insider
KUALA LUMPUR, March 14 — Sime Darby Bhd’s RM338 million lawsuit against its disgraced chief executive Datuk Seri Ahmad Zubir Murshid and four others is expected to be a major exercise of washing dirty linen, with top government officials called to testify about their knowledge of the conglomerate’s operations.
The Malaysian Insider understands that the defendants are going to call Prime Minister Datuk Seri Najib Razak and his two predecessors, Tun Abdullah Ahmad Badawi and Tun Dr Mahathir Mohamad over the suit filed last December.
The suit over RM2.1 billion losses incurred by Sime had named Zubir and four others, Datuk Mohamad Shukri Baharom, the former executive vice-president of the energy and utilities division; the division’s chief financial officer Abdul Rahim Ismail; the division’s oil and gas unit chief Abdul Kadir Alias; and Mohd Zaki Othman, from Sime Engineering.
The defendants are expected to claim that the conglomerate’s loss-making ventures in Bakun and Qatar were public knowledge to even top government leaders.
“They have all been sued for breaches of duties owed to the Sime Darby Group,” the company said in a statement released on December 23, 2010.
In its statement of claim, Sime Darby alleged that the five accused acted as a “decision-making unit” in the energy and utilities division and were responsible for the division’s actions and omissions.
Sime Darby further alleged that the accused had been grossly negligent for allowing Sime Darby Engineering to pursue engineering, procurement, construction, installation and commissioning (EPCIC) projects in which it had no prior experience.
The five men were also accused of awarding EPCIC jobs to similarly inexperienced subcontractors and for failing to pursue claims for work not done.
Sime Darby’s two suits follow its announcement in September that a forensic audit into the energy and utilities division had established a prima facie case of foul play and a failure to carry out its duties and obligations.
The conglomerate’s woes first came to light in May when then-chief executive Ahmad Zubir was asked to take a leave of absence prior to the expiry of his contract following the discovery of RM964 million in cost overruns from the four energy and utilities projects.
The massive cost overruns bled the division and led to the announcement of Sime Darby’s first ever quarterly loss of RM308.6 million that same month.
In the previous corresponding quarter, Sime Darby had posted a profit of RM150.6 million.
