KUALA LUMPUR – Questions on leadership and company direction continue to swirl at Prasarana Malaysia Bhd as non-executive chairman Datuk Seri Tajuddin Abdul Rahman is expected to shake things up.
The Edge yesterday reported that Tajuddin “had sought the termination of the contractors of the transport-oriented development at the Dang Wangi light rail transit (LRT) station, with Prasarana looking to play a more prominent role in the project and eventually move its office to the new development”.
The ongoing project in the area is a mixed-use commercial development known as Latitud 8.
However, the termination could cost Prasarana as much as RM80 million.
It was reported that documents indicate that the Finance Ministry had given “tacit approval” for the company to move its office, from its current office at Menara UOA, Bangsar.
Many of the findings are from the minutes – sighted by The Edge – of Prasarana’s board meeting on October 10.
Crest Builder Holdings Bhd and its 51%-unit Intan Sekitar Sdn Bhd are involved in the construction of Latitud 8.
Intan Sekitar’s remaining 49% is owned by Detik Utuh Sdn Bhd where Tajuddin’s daughter Datin Sri Rahayu is a director.
It was reported that Detik Utuh’s shareholders are Tindakan Juara Sdn Bhd (40%), Obata-Ambak Holdings Sdn Bhd (35%) and Vignesh Naidu Kuppusamy Naidu (25%).
Tindakan Juara is 35% owned by Sri Rahayu, 35% by Datin Seri Rohkiah Abd Samat and 30% by Firdaus Tajuddin. Rohkiah is Tajuddin’s wife while Firdaus is his son.
Rohkiah and Firdaus were appointed to the board of Tindakan Juara in early 2007, about four months after the company was registered. Sri Rahayu was appointed to the board in February 2010.
Crest Builder and Detik Utuh won the bid to develop the 1.09ha tract on the site of the Dang Wangi LRT station at end-March 2012.
Prasarana, which owned the land on which the development was slated to take place, was to receive RM46.64 million or 21.2% of the project’s estimated GDV of RM220 million.
Tajuddin, who is also Pasir Salak MP, was appointed Prasarana chairman in May.
According to Crest Builder’s annual report for FY2019, the Latitud 8 development had already commenced the main building works. The launch of the development was slated for end-2016, according to news reports.
News reports published last year say construction was halted, with the date of a relaunch of the project in 2020. However, a call from The Edge to the offices of Latitud 8 found that the launch is expected in one or two years, “due to market sentiment”.
Previously, The Vibes reported that president and group chief executive (PGCE) Muhammad Nizam Alias had been suspended.
Chief operations officer Datin Norlia Noah has taken over temporarily, and more changes in the national transport operator’s senior leadership team and management are expected soon.
Industry sources attribute his suspension to a testy relationship at the leadership level since Tajuddin was appointed chairman.
This is not the first time Prasarana, which is owned by Ministry of Finance Inc and governed by the Transport Ministry, has suspended its PGCE.
Nizam’s predecessor, Datuk Mohamed Hazlan Mohamed Hussain, received the same treatment on December 24 last year on the back of public dissatisfaction over the group’s LRT services.
Nizam, the then COO, filled in, and was later bumped up to PGCE.
Prasarana maintains and operates Malaysia’s two LRT networks, namely the Kelana Jaya line and Ampang-Sri Petaling line, as well as the KL Monorail, bus rapid transit Sunway line, and bus services in Kuala Lumpur, Penang, Kuantan and Kamunting. It is also the operator of the mass rapid transit service in the Klang Valley.
But, the group has been bleeding red ink since 2014. According to its latest financial results ended December 31 last year, Prasarana registered a loss of RM3.61 billion on the back of RM842.09 million in revenue. Its total liabilities for the year stood at RM35 billion compared to total assets of RM1.29 billion.
External auditor Ernst & Young PLT, in Prasarana’s 2019 annual report, said as liabilities exceeded assets, “these conditions indicate the existence of material uncertainties that may cast significant doubt on the group’s and the company’s ability to continue as a going concern and, therefore, the group and the company may be unable to realise their assets and discharge their liabilities in the normal course of business”. – The Vibes, December 29, 2020
