Chinese New Year, in fact all festive occasions, with the exception of Hari Raya, there is such joviality and happiness brought about by that poison, that tongues get loose and many things are divulged, as they say, caution is thrown to the wind.
One of the stories that I heard is of such repercussions that I am wondering how come we have not heard the crumbling sound of the whole organisation as it comes crashing down.
Now it seems that when ever a berhad (not just listed berhad, but berhads) solicit funds from the public they need to get permission from the Capital Markets Regulator ("CRM"). Apparently there was such a case where the berhad did not get approval, and naturally the CMR took action. Now here is the intrigue,
1. Apparently the case was thrown out, it seems that the judge thought that the law and or facts were incorrectly applied. Larger issue is, is this only referenced to this particular case or does it effect all future solicitation of funds. Can you imagine, the wider net that it could apply too.
2. Apparently it was handled by a junior prosecuting officer, why a case that had the potential for far reaching ramifications was not handled by the Head of the Department needs to be questioned. Maybe the belief is that since they are the CMR, the judiciary will always grant them what they wish!
3. Now this is the more interesting part, that the defending lawyer was a former employee of the CMR and there are rumblings that some sort of pally relationship exist between the former and current prosecuting officers. Apparently a number of former prosecuting officers have gone on to set up their own legal practise and for some reason specialise in CMR's cases. I wanted to ask more, but I was afraid if I did that I would have alerted them and that would have been the end of the stories.
I am told that there would be an appeal lodged, but what is ironic is that how could it have happened in the first case. It only adds to what I have been saying, the organisation has become totally dysfunctional with no leadership, more time is spent with opening ceremonies, photo taking and overseas trips. The time has come for change!
Maybe Mr. Tan Sri Dato Seri needs to have people that are willing to challenge his decision and instructions rather then having silence, remember Silence does not mean acceptance (read correct), Only God Can Be Correct All the Time!
Tuesday 7 February 2017
Calling a Spade a Spade - The Continuing Sime Darby Fiasco - Update
Just a short note, did you guys notice that on Saturday last and today there were rating agencies being negative on the proposal with regards to separately listing the Plantation and Property Group. I hope that PNB is taking note and will do the right thing. What was it that the late President Kennedy said.
you can fool some people all of the time,
you can fool all of the people some of the time,
But you cannot fool all of the people all of the time!
Truly I hope that the new Chairman and CEO of PNB will do the right thing. The right thing takes time, effort and strength and addresses the root cause of the problem. After all no pain, no gain.
you can fool some people all of the time,
you can fool all of the people some of the time,
But you cannot fool all of the people all of the time!
Truly I hope that the new Chairman and CEO of PNB will do the right thing. The right thing takes time, effort and strength and addresses the root cause of the problem. After all no pain, no gain.
Wednesday 1 February 2017
Calling a Spade a Spade - The Continuing Sime Darby Fiasco
So in the late 90s and early 2000s the owners of Sime Darby Berhad started the process of taking public listed entities within the group private. Some suggested that it was to make sure that income flowed totally to the holding without any dilution (by way of minority payments).
Then in the mid 2000s there was the merger with other plantation companies within the PNB group, the saying was that big was beautiful, synergies, economies of scale etc etc etc.
Now since the new Chairman of PNB has come in, its let's re-list property and plantations (I understand the Motor entity was to be included but the numbers are not so good) to unlock value.
Wow within 15 years we are back to another round of list, delist and re-list, (of course the thought did occur to me whether it has equally to do with generating income for the Maybank group).
Now lets be realistic, its time for brutal honesty;
1. Is this really for unlocking value or to hide the fact that the group is a non performing group.
2. Fact remains that the current CEO is a non performing chap, every where he has been too, FELDA, Bank Islam, TH etc etc, he has never enhanced the value, many argue that in fact he left the entity worse off.
3. Reality is that after the Sime/Qatar debacle they have never been able to recover. At that time there was a light weight CEO, he was removed another lightweight was appointed, nothing has changed. Why when almost all the management left/was replaced from the time of the Sime/Qatar but the CFO still remains puzzles many. Does the CFO not play an important and pivotal part, is the CFO not the check and balance to the CEO, could the CFO not have been more effective then and now, or was the package more alluring that the right thing to do was to be silent and hold on to dear job.
4. Ignoring the fact that the current CEO is really not a toughie, what really happened was Sime went and over geared itself in purchasing NBPOL, and what that means is if you are not an efficient company, eventually you will not be able to meet your obligations.
So Sime was forced to par down its debts by selling prime assets. Lucky for them their PR department was able to sell to the media as a monetisation program. So now we got this poor performing CEO and lepak CFO being made to look like heros. One must also ask what happened to the much vaunted Risk Management system, they should have spotted red flags.
So cutting the story short, PNB Chairman and CEO, lets face reality, its not a case of unlocking value, its a case of hiding the incompetency of the Board, its CEO, CFO, Risk Management division, oops it looks like maybe the whole group.
You guys don't believe me that the whole system is broken, ask the CEO whether he tried to appoint his buddy as Chief Internal Auditor and when Audit Committee said maybe not, he continued with current one till now, maybe its some new management philosophy!
So Tan Sri Chairman, to generate real value please put the group right, ring out the inefficiencies and ineffectiveness, it might take some time, you might be surprised that the group will be far more profitable then you imagined.
Maybe to start of you may want to ask why not only the CEO has a BMW 7 series but all his direct reports, why when they travel they travel in entourages etc etc.
Remember nice people do not run performing companies, they run charities! Doing the delist, re-list, delist etc is not addressing the real issues, it only delays the inevitable.
Then in the mid 2000s there was the merger with other plantation companies within the PNB group, the saying was that big was beautiful, synergies, economies of scale etc etc etc.
Now since the new Chairman of PNB has come in, its let's re-list property and plantations (I understand the Motor entity was to be included but the numbers are not so good) to unlock value.
Wow within 15 years we are back to another round of list, delist and re-list, (of course the thought did occur to me whether it has equally to do with generating income for the Maybank group).
Now lets be realistic, its time for brutal honesty;
1. Is this really for unlocking value or to hide the fact that the group is a non performing group.
2. Fact remains that the current CEO is a non performing chap, every where he has been too, FELDA, Bank Islam, TH etc etc, he has never enhanced the value, many argue that in fact he left the entity worse off.
3. Reality is that after the Sime/Qatar debacle they have never been able to recover. At that time there was a light weight CEO, he was removed another lightweight was appointed, nothing has changed. Why when almost all the management left/was replaced from the time of the Sime/Qatar but the CFO still remains puzzles many. Does the CFO not play an important and pivotal part, is the CFO not the check and balance to the CEO, could the CFO not have been more effective then and now, or was the package more alluring that the right thing to do was to be silent and hold on to dear job.
4. Ignoring the fact that the current CEO is really not a toughie, what really happened was Sime went and over geared itself in purchasing NBPOL, and what that means is if you are not an efficient company, eventually you will not be able to meet your obligations.
So Sime was forced to par down its debts by selling prime assets. Lucky for them their PR department was able to sell to the media as a monetisation program. So now we got this poor performing CEO and lepak CFO being made to look like heros. One must also ask what happened to the much vaunted Risk Management system, they should have spotted red flags.
So cutting the story short, PNB Chairman and CEO, lets face reality, its not a case of unlocking value, its a case of hiding the incompetency of the Board, its CEO, CFO, Risk Management division, oops it looks like maybe the whole group.
You guys don't believe me that the whole system is broken, ask the CEO whether he tried to appoint his buddy as Chief Internal Auditor and when Audit Committee said maybe not, he continued with current one till now, maybe its some new management philosophy!
So Tan Sri Chairman, to generate real value please put the group right, ring out the inefficiencies and ineffectiveness, it might take some time, you might be surprised that the group will be far more profitable then you imagined.
Maybe to start of you may want to ask why not only the CEO has a BMW 7 series but all his direct reports, why when they travel they travel in entourages etc etc.
Remember nice people do not run performing companies, they run charities! Doing the delist, re-list, delist etc is not addressing the real issues, it only delays the inevitable.
You just simply don't listen! - The AA situation - An Update
Last week there was this long, almost a page, news report in the financial edge relating to the fact that AAX was quoted in a charge relating to the Rolls Royce ("RR") bribery. The report's opening para said that AA has no relationship or dealings with RR, and claims no knowledge of the matters relating to the USD3.2m graft! All I can say is yes they are correct, AA it would seem has no relationship but sister company AAX did sign to have their A330s powered by RR's Trent engine.
Now we all know that there are two heavyweights (no pun intended) that are instrumental in all major transactions that involve the group. So by saying AA is not involved and stating that there are no relationships with RR is technically correct, we also know that when a statement is made it must be unequivocally clear, especially when it involves a group where management is considered as one by the general public.
Now I believe, in my simple mind, that what AA/AAX should do is to make a very firm denial regarding this matter, appoint a top solicitor and challenge the Serious Fraud Office, after all its reputation is being hung outed and questioned, and I am sure the heavyweights in particular would not want this to happen, especially when they are planning an IPO, or are there reasons that they prefer that remains unknown.
It would additionally be nice if the group would also shed more light regarding the transaction with the Executive jet, yes it was reported that it all went through the Audit Committee, but considering its seriousness it would be good for transparency and it would make interesting reading for the simple mind and demonstrate a high degree Good Corporate Governance.
Considering the seriousness of this matter, I am wondering if Bursa have or will be asking for further clarification! Oh maybe not, since they have this situation of "we have a new CRO, we don't have a new CRO, no no our CRO is still our CRO!
Finally remember my theory of patterns, there is a single occurrence, then two occurrences, and finally its a way of live..........................people don't fail because they are stupid, they fail when they become arrogant!
Now we all know that there are two heavyweights (no pun intended) that are instrumental in all major transactions that involve the group. So by saying AA is not involved and stating that there are no relationships with RR is technically correct, we also know that when a statement is made it must be unequivocally clear, especially when it involves a group where management is considered as one by the general public.
Now I believe, in my simple mind, that what AA/AAX should do is to make a very firm denial regarding this matter, appoint a top solicitor and challenge the Serious Fraud Office, after all its reputation is being hung outed and questioned, and I am sure the heavyweights in particular would not want this to happen, especially when they are planning an IPO, or are there reasons that they prefer that remains unknown.
It would additionally be nice if the group would also shed more light regarding the transaction with the Executive jet, yes it was reported that it all went through the Audit Committee, but considering its seriousness it would be good for transparency and it would make interesting reading for the simple mind and demonstrate a high degree Good Corporate Governance.
Considering the seriousness of this matter, I am wondering if Bursa have or will be asking for further clarification! Oh maybe not, since they have this situation of "we have a new CRO, we don't have a new CRO, no no our CRO is still our CRO!
Finally remember my theory of patterns, there is a single occurrence, then two occurrences, and finally its a way of live..........................people don't fail because they are stupid, they fail when they become arrogant!
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