This article first appeared in The Edge Financial Daily on April 12, 2019

KUALA LUMPUR: Former Federal Land Development Authority (Felda) chairman Tan Sri Mohd Isa Abdul Samad, who is facing graft charges over Felda’s purchase of a hotel in Sarawak, yesterday defended the agency’s acquisition of a 37% stake in Indonesian plantation firm PT Eagle High Plantations Tbk two years ago, saying the buy was to increase Felda’s land bank.

Isa told reporters when met at the court house that the non-controlling Eagle High stake buy at a cash price of US$505.4 million — a price tag said to have been inflated over 300% from the stake’s market value of US$114 million then — was done because Felda failed to acquire land in Papua New Guinea.

“The Papua New Guinea purchase was made by Sime Darby so Felda moved in on the Eagle High [stake] purchase to increase its land bank,” Isa said, likely referring to Sime Darby Plantation Bhd’s acquisition of some 135,000ha of agriculture land in Papua New Guinea, which was completed in March 2015.

He was commenting on the police report lodged by Felda director-general Datuk Dr Othman Omar on Monday evening, in which the latter claimed that Felda was cheated in the Eagle High stake purchase.

Isa also echoed former prime minister Datuk Seri Najib Razak’s stand that Felda is protected in the Eagle High stake purchase, saying the deal came with a put option that Felda can exercise to sell back the stake at the same purchase price, with a 6% interest.

Felda’s board of directors exercised the put option in a letter dated Jan 3 this year on the grounds that the Rajawali Group, which sold the stake to them, failed to meet key conditions. However, Rajawali, which is headed by Tan Sri Peter Sondakh, who is said to be a friend of Najib, is now challenging the put option in court.

Following Othman’s police report, Inspector-General of Police Tan Sri Mohamad Fuzi Harun said on Wednesday that several VIPs would be called in to assist the Commercial Crime Investigation Department’s probe into possible abuse of power in the Eagle High stake purchase deal.

Isa, who helmed Felda between 2010 and 2017, said he is prepared to assist police investigations if called to do so. “There were some inaccurate statements made [regarding the Eagle High stake purchase],” he added.

Meanwhile, he lauded the government’s move to inject RM6.3 billion into Felda to assist Felda settlers. “This will help the settlers and Felda as a whole,” he said.

The former Felda chairman also welcomed the probe following Port Dickson member of parliament and PKR president Datuk Seri Anwar Ibrahim’s allegation that Felda bought 100 cars and caused a congestion at the Felda headquarters.

He also said there is no truth to the allegation that Felda finished its reserves of RM8 billion, as the amount was actually debt incurred by settlers, and mostly involved replanting, housing and commercial loans given to them.

“All this is done as a political smear campaign [by Pakatan Harapan]. This claim made by them, as stated in the White Paper, is untrue,” he said, adding that he is prepared to explain the misconceptions made during his tenure in Felda.