Khazanah board sends quit letters, awaits Putrajaya move
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THE entire Khazanah Nasional Berhad board has submitted undated resignation letters this week to ultimate shareholder Ministry of Finance Inc (MoF Inc) as all eyes are on its possible replacements named as early as today.
The Malaysian Insight understands the directors of the sovereign wealth fund met on Tuesday and resolved to submit the undated resignation letters, including managing director Azman Mokhtar, whose contract is due to end June 2019.
Khazanah did not return calls to confirm the board decision. It is Malaysia’s main sovereign wealth fund with strategic interest across most sectors, including finance, health, telecommunications, aviation and utilities.
The current Khazanah board has nine members, including Azman. The others are Md Nor Md Yusof, Mohamed Azman Yahya, Mohammed Azlan Hashim, Raja Arshad Raja Uda, Andrew Sheng Len Tao, Nazir Abdul Razak, Nirmala Menon and Yeo Kar Peng.
By convention, the Khazanah board is chaired by the prime minister with the finance minister and the Treasury secretary-general as members.
But former prime minister Najib Razak, former finance minister II Johari Ghani and the former Treasury secretary-general Irwan Siregar Abdullah resigned on May 31 after the Barisan Nasional (BN) government lost in the May 9 general election.
Prime Minister Dr Mahathir Mohamad and Finance Minister Lim Guan Eng have yet to be named to the Khazanah board, which has missed two meetings this year. The board usually meets every financial quarter.
The Malaysian Insight reported on July 13 that Khazanah is to get a new boss in 14 years after Dr Mahathir’s remarks a week earlier that clearly suggested the sovereign wealth fund was to get a new direction with fresh leadership at the helm.
Azman indicated then he was prepared to go earlier than his contract expiry if given the marching orders from Putrajaya. But he never got to meet Dr Mahathir despite making efforts to get an appointment.
In recent weeks, heads of government-linked companies and funds have left or their contracts not renewed, including Permodalan Nasional Berhad chairman Abdul Wahid Omar, who resigned in June after failing to meet Dr Mahathir.
Dr Mahathir, who formed Khazanah in 1994 to hold shares in government firms, told local media that “they were no longer following the initial intention of the formation of Khazanah”.
The prime minister, who is in power for a second time after a break of 15 years, was blunt about Khazanah, saying the strategic investment arm “was doing all kinds of funny things, they are buying houses. they are creating and taking over companies”.
Dr Mahathir’s comment effectively raised question marks over Azman’s position as managing director, a post that he has held under two prime ministers.
In response, Khazanah said in a statement that it was “seeking further clarification as necessary from the government and other respective parties… with a view towards clarifying, reaffirming and implementing our mandate as the strategic investment fun of the government of Malaysia”.
The Khazanah website states that it holds and manages the commercial assets owned by the government and undertakes strategic investments on behalf of the nation and has interests in more than 100 companies in a number of sectors from power and aviation to healthcare and financial services.
As of December 2017, Khazanah has a realisable asset value of RM157.2 billion while its net worth adjusted reached a record high of RM115.6 billion. – July 26, 2018.