Thursday 28 Mar 2024
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KUALA LUMPUR: In a swift response to new developments in the criminal trials arising from the Port Klang Free Zone (PKFZ) fiasco, OSK Trustees Bhd is said to have denied
knowledge that it was “cheated” into releasing millions of ringgit in payments for the controversial transshipment hub project.

It is learnt that OSK Trustees circulated yesterday a statement to holders of bonds issued by three special-purpose vehicles (SPVs) — Transshipment Megahub Bhd, Valid
Ventures Bhd and Free Zone Capital Bhd.

The three SPVs were among the four vehicles established by PKFZ’s turnkey contractor, Kuala Dimensi Sdn Bhd (KDSB), for the troubled project.

It is understood that OSK Trustees told bondholders that it was “taken by surprise” at the news that prosecutors had on Monday pressed 26 alternative charges against three
people.

The alternative charges were for allegedly cheating OSK Trustees into releasing payments totalling RM122.27 million to KDSB for works that were purportedly not
carried out in the PKFZ project.

The trio — former KDSB chief operating officer Stephen Abok, former KDSB project manager Law Jenn Dong and consultant architect Bernard Tan Seng Swee — are also facing
related charges of cheating the Port Klang Authority (PKA), which owns the PKFZ project, into endorsing payment to KDSB for those amounts.

The three men had pleaded not guilty to all charges and alternative charges. The case is currently being tried at the Klang Sessions Court, with the next hearing being Nov
22.

OSK Trustees is said to have been caught unawares given that it had not filed any official complaint with the authorities that it had been “cheated”.

The trust company had also apparently said that it was not informed about the alternative charges although it did provide statements and documents as requested by
the police in the course of investigations into the trio.

OSK Trustees is believed to be seeking legal advice on the latest development.

The statement from OSK Trustees also sought to reassure bondholders that the funds due this month for principal and coupon redemptions under Valid Ventures and Free Zone
Capital would be duly paid out on the due dates, barring any unforeseen circumstances.

Transshipment Megahub’s bond and medium-term notes were duly paid on Nov 3, OSK Trustees said.

In July, the PKFZ-related bonds were feared to be in jeopardy after PKA’s board decided to withhold the final payment of RM222.58 million to Free Zone Capital.

PKA’s board decision was purportedly in view of the port authority’s RM1.4 billion legal suit against KDSB, for alleged wrongful and excessive claims on work done for
the PKFZ, among other claims.

However, Transport Minister Datuk Seri Kong Cho Ha promptly directed PKA’s board to release payment due to bondholders, in line with the government’s pledge to honour all
debt obligations issued by KDSB to finance the PKFZ project.

Free Zone Capital aside, PKA is due to make scheduled payments to the other three SPVs until 2017 and had taken out a 20-year soft loan of RM4.6 billion from the Ministry of
Finance (MoF) to repay bondholders.

PKA’s first repayment to the MoF is due in November.

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