RM160 mil hotel bought without Felda board’s approval, court told
Ho Kit Yen
-November 28, 2019 6:29 PM
Felda’s subsidiary company, Felda Investment Company Sdn Bhd, only tabled a report on its investment in Merdeka Palace Hotel and Suites at a Felda board meeting on Dec 1, 2014.KUALA LUMPUR: A Felda officer told the Isa Samad corruption trial that the company’s board of directors did not receive any application from its subsidiary investment company seeking approval to buy a Kuching hotel five years ago.
Erwan Aman, the board secretary from 2012 to 2016, said the subsidiary company, Felda Investment Company Sdn Bhd, only tabled a report on its investment in Merdeka Palace Hotel and Suites at a Felda board meeting on Dec 1, 2014.
The hotel was sold to Felda for RM160 million by Gegasan Abadi Properties Sdn Bhd.
“They (Felda Investment) should have tabled a proposal to seek the Felda board’s approval of their investment as it was valued at more than RM100 million.”
He said the Felda board of directors must have the final say if any subsidiary company wanted to spend more than RM100 million in investments.
Erwan Aman.Erwan said Felda’s board of directors had approved the setting up of Felda Investment as a special purpose vehicle company for investment purposes during a board meeting on June 26, 2013.
To a question by deputy public prosecutor Nithtia Sivasamy on whether Isa was aware that Felda Investment needed to seek the board’s approval on investments of more than RM100 million, Erwan said Isa knew about it as he had chaired the meeting on June 26, 2013 where the directors had discussed the need for their approval for investments of more than RM100 million.
Crossed-examined by Isa’s lawyer, Salehuddin Saidin, on whether Erwan, as board secretary, had prepared any circular or memorandum to inform Felda Investment or any other Felda subsidiary on the decision made at the June 26, 2013 meeting, the witness said “yes” at first but gave contradictory answers when more questions were posed.
“I need to check with the company,” Erwan finally said.
The lawyer then pointed out that previous witnesses, such as then Felda Investment CEO Mohd Zaid Abdul Jalil and then director-general Hanapi Suhada, had told the court that it was Erwan’s responsibility to check whether the report from Felda Investment on the Kuching hotel purchase had complied with the board’s decision.
Nithtia objected to the question, saying it was a waste of the court’s time as the witness had not heard the testimonies of Zaid and Hanapi.
However, trial judge Mohd Nazlan Mohd Ghazali told Erwan to answer the defence counsel’s question.
Erwan then said his job was only to take down minutes of meetings.
The hearing will continue on Jan 13 and 14, 2020.
