UEM Sunrise-EcoWorld merger a bailout, says Amanah

Amanah strategy director Dzulkefly Ahmad questioned the use of taxpayers’ money for helping EcoWorld, a private entity, and the objective behind the merger.

PETALING JAYA: Amanah strategy director Dzulkefly Ahmad has joined those opposing the proposed merger between UEM Sunrise Berhad and EcoWorld Development Group Berhad, saying the deal was a “bailout”.

In a statement, the former health minister said it was regrettable that Khazanah Nasional, a sovereign strategic investment fund, had decided to provide financial assistance to what he termed as a “failing business”.

He also questioned the use of taxpayers’ money for helping EcoWorld, a private entity, and the objective behind the merger.

“What does the rakyat get out of this corporate exercise? More jobs? Truth be told, mergers invariably result in loss of jobs. Or is it about better share values and dividends to Khazanah Berhad?

Dzulkefly Ahmad.

“We fail to understand what warrants such intervention.”

Dzulkefly said it was not a strategic move, given the current property overhang and lack of consumer spending as a result of the Covid-19 pandemic.

Recently, former deputy housing minister Raja Kamarul Bahrin voiced concern over reports that EcoWorld will ultimately control the merged entity, saying the deal raised many questions.

Federal Territories Umno Youth had also urged the Perikatan Nasional (PN) government to stop the proposed merger.

It questioned how the merger would benefit Khazanah and the finance ministry, claiming UEM Sunrise stood to lose more than EcoWorld in the merger.

On Monday, UEM Sunrise received a letter of proposal from UEM Group Bhd for a merger with Eco World.

It was proposed the two companies would merge through an exchange of shares and warrants. Eco World will subsequently be delisted from Bursa Malaysia.