Raking In The Bounty of FELDA’s IPO
M Bakri Musa
In the run-up to the Initial Public Offering (IPO) of FELDA Global Ventures Holdings (FGH), there is little, in fact no discussion on how the exercise would benefit FELDA settlers. Surely that should be the foremost consideration. The only criterion upon which to judge the wisdom or success of any FELDA initiative, including this proposed IPO, would be to assess its impact on the settlers.
Instead the focus has been on bragging rights, as with trumpeting FGH to be the biggest IPO for the year, among the top 20 on the KLSE, and the world’s biggest plantation company. Such milestones are meaningful only if achieved as a consequence of the usual business activities and not through fancy paper-shuffling exercises. Apple recently surpassed Microsoft in market capitalization, but that was the consequence of Apple’s much superior products like iPads, iPods, and iPhones. Contrast that with earlier achievements of such now-defunct financial giants as AIG and Lehman Brothers that were based on fancy “financial engineering” instead of solid products and services.
Instead of delineating the potential benefits that would accrue on the settlers from this IPO, its proponents are content with dismissing the critics and imputing evil motives on their part. There are legitimate concerns that this exercise would prove to be nothing more than yet another fancy scheme for the politically powerful to cash out on a lucrative but under-priced government asset. We already have many ready examples of such greed.
Consider the National Feedlot Corporation (NFC) “cowgate” mess involving considerably much smaller sum of money. Despite the presence of high government officials on NFC’s board to safeguard the government’s interest, NFC’s senior managers still managed to subvert those publicly-subsidized loans to purchase luxury condominiums totally unrelated to the company’s activities. This oversight failure reflects both the incompetence of the government’s representatives in discharging their fiduciary responsibility, as well as the lack of integrity on the part of NFC’s management.
Such despicable omissions and spectacular failures are not unique only to NFC; they are endemic in government-linked corporations. Thus Malaysians have good reasons to believe that FGH would be no exception once the money starts rolling in.
It also does not escape the public’s attention that the man helming FGH, and thus whose hands would be at the till once the billions start pouring in from the IPO, is one Isa Samad, a former UMNO Vice-President. Not any VP however, but one who was found guilty by his party of “money politics” and subsequently suspended. UMNO is no paragon of virtue; to be found guilty by it would be akin to being called a slut by hookers. You have to be disgustingly gross.
It would be easy to blame Isa Samad. The bigger question, and one that has yet to be answered, is why did Prime Minister Najib choose such a shady character to helm this major corporation? That is as much a reflection of Najib as it is on Isa.
Peruse FGH current corporate structure. It has nearly over a hundred subsidiaries, associated companies, and joint ventures, many with overlapping functions, markets and products. Those units are created less in response to commercial needs, more to create opportunities for senior civil servants to be appointed to the many governing boards, and thus garnering extra income in the form of directors’ fees, in addition to their regular civil service pay. Ever wonder why these GLCs lack effective oversight and our government departments are shoddily run? You would think that their regular government jobs, diligently executed, would keep them fully occupied.
A more sinister reason for these GLC directorships is that they are an effective trick to trap the loyalty of civil servants. Be too critical of the idiotic ideas of your political superiors and you risk being left out on those lucrative board appointments. With Isa Samad, it is also a case of Najib buying Isa’s silence, for reasons best known only to the pair.
