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Arul Kanda will accept Bandar Malaysia, TRX boards’ decision

 | May 8, 2017

But the 1MDB CEO says he has not received any notification of his removal as a board member of both companies.


PETALING JAYA: 1MDB’s CEO Arul Kanda Kandasamy said he has not received any official notification of his dismissal from the Bandar Malaysia Sdn Bhd and Tun Razak Exchange (TRX) company boards.

However, he said decisions regarding board directors of both firms were up to the finance ministry (MOF).

“It is public information that my appointment as a board member of TRX City and Bandar Malaysia was due to 1MDB being the shareholder of both firms,” Arul said in a text message to FMT.

“As those companies have been transferred by 1MDB to MOF Inc with effect from March 31, 2017, it is only reasonable to expect that MOF Inc will seek to appoint new directors, per its discretion.”

A news report this evening cited sources as saying that the dismissal came as there may be “potential conflicts of interest” in the fallout from the failed Bandar Malaysia deal with the consortium of Iskandar Waterfront Holdings Sdn Bhd ( IWH) and China Railway Engineering Corp (CREC).

Asked about this, Arul said as a professional manager, “I serve as required by the shareholder.

“I will always be guided by and will accordingly accept any decisions made by the shareholder.”

On May 3, TRX City said the share sale agreement (SSA) with IWH and CREC regarding the sale of 60% of the issued and paid-up capital of Bandar Malaysia had lapsed.

It said this was due to the failure of the purchasing parties to fulfil payment obligations.

In a statement, TRX City said despite repeated extensions being granted, IWH-CREC failed to meet the payment obligations outlined in the conditions under the SSA, which was signed on Dec 31, 2015.

Following that, it said given a significant appreciation in the value of the Bandar Malaysia land, TRX City’s sole shareholder, the finance ministry, would now be retaining 100% ownership of the site to ensure the Malaysian people benefited from its development in its entirety.

Arul was made 1MDB CEO in January 2015 and retains the post despite this latest development.

Malaysia’s US$1.7 billion property deal to cut 1MDB debt falls through


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