1MDB seeks to delay first payment to IPIC

1mdb-ipicPETALING JAYA: Troubled state firm 1MDB today blamed its failure to pay the first half of a US$1.2 billion payment to Abu Dhabi-based International Petroleum Investment Company (IPIC) on a delay in getting proceeds from its rationalisation plan.

In a statement some four hours after deadline for the payment passed at 12.00 noon today, the company said it had written to IPIC to allow it to make the payment this month.

“Due to the need for additional regulatory approvals, the receipt of those funds has been delayed to August 2017,” it said.

1MDB reached an agreement in April to pay IPIC US$600 million as the first of two instalments. It had previously said payments would be made by monetising investment fund units.

IPIC was merged with UAE’s state investment firm Mubadala earlier this year.

As part of the agreement, 1MDB and the finance ministry will assume responsibility for all future interest and principal payments under two bonds worth US$3.5 billion in total.

The agreement was reached after the Malaysian fund defaulted on its bonds in 2016, sparking a dispute with IPIC, which asked a London court to arbitrate a claim totalling some US$6.5 billion.