This article first appeared in The Edge Financial Daily on July 21, 2017

KUALA LUMPUR: Felda Global Ventures Holdings Bhd (FGV) yesterday appointed Datuk Khairil Anuar Aziz, the group’s chief operating officer (COO) [logistics and others sector], as officer-in-charge to take over the duties and responsibilities of suspended group president and chief executive officer (CEO) Datuk Zakaria Arshad with immediate effect.

In a filing with Bursa Malaysia, the plantation giant also announced that its board executive committee (BEC) has been disbanded.

“The FGV board would like to express its highest appreciation to the members of the BEC comprising [chairman] Datuk Omar Salim, Datuk Zafer Hashim and Azman Ahmad for their valuable contributions since June 6, 2017,” said FGV in a separate statement. Omar and Zafer are FGV directors, while Azman is its head of logistics cluster.

The BEC was formed following the suspension of Zakaria on June 6, pending an internal investigation into alleged accounting irregularities at Delima Oil Products Sdn Bhd, which had dealings with Dubai-based firm Safitex Trading LLC.

Khairil is currently a director in Sinergi Perdana Sdn Bhd, a consortium formed by The Federal Land Development Authority (Felda), the Federal Land Consolidation and Rehabilitation Authority, better known as Felcra, and Rubber Industry Smallholders Development Authority, better known as Risda, to coordinate the three government agencies’ venture into the fertiliser and agrochemical business.

Additionally, he is the cluster chairman of government-linked companies and has been a panel member of Gabungan Pemikir Professional Felda since 2009.

Khairil also sits on the board of Pelaburan Mara Bhd and Lembaga Pelabuhan Kuantan Bhd, and has previously served Renong Bhd and UEM Bhd, among others.

It is worth noting that Khairil, who has been with FGV since 2012, is a second-generation Felda settler. The former settler’s son named to a top post in the group is none other than Zakaria and his appointment was seen as boding well for the group. And many settlers continued to root for Zakaria when he was implicated in the investigation.

Additionally, the investing fraternity has also lauded Zakaria for calling off acquisitions that were deemed costly, such as the planned purchase of a 35% stake in PT Eagle High Plantations Tbk in Indonesia from Tan Sri Peter Sondakh’s Rajawali Group for US$632 million (RM2.71 billion) — a deal that has since been taken over and completed by Felda.

Meanwhile, CIMB Research analyst Ivy Ng said the latest development is “neutral” for the group. “Khairil’s appointment is still a temporary one, so there may be no impact,” Ng told The Edge Financial Daily.

The appointment, said Ng, is only a reshuffling of the management line-up, which is not so different from the disbanded BEC. “It will be ‘neutral’ for the company. Until the domestic enquiry is finalised, the company is still without a CEO,” she added.

Zakaria was suspended along with FGV chief financial officer (CFO) Ahmad Tifli Mohd Talha and two other senior officers, namely Delima Oil Products senior general manager Kamarzaman Abd Karim and FGV Trading Sdn Bhd CEO Ahmad Salman Omar.

The BEC was to temporarily take over Zakaria’s role, whereas FGV’s plantation-sector group financial controller Aznur Kama Azmir was appointed as interim CFO.

On June 7, the Malaysian Anti-Corruption Commission began investigation into FGV after Zakaria claimed the existence of abuse of power and corruption in the group’s operations. The investigation has not been concluded.

Amid the boardroom tussle, FGV chairman Tan Sri Mohd Isa Samad, who Zakaria said triggered the suspensions, exited the group on June 20 under the orders of the Prime Minister’s Department. Taking over Mohd Isa’s role as acting chairman was another FGV director, economist Tan Sri Dr Sulaiman Mahbob.

On July 4, FGV said its board of directors decided to refer Zakaria and Ahmad Tifli to a domestic enquiry panel, after evaluating the two men’s show-cause letters on the irregularities. Later on July 17, Sulaiman said the domestic enquiry would initiate on July 24, and should resolve the internal issues by Aug 14.

FGV’s share price closed two sen or 1.19% lower at RM1.66 yesterday, with a market capitalisation of RM6.06 billion.