Newsmakers 2014: Playing musical chairs

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EVERY year, Corporate Malaysia witnesses a big game of musical chairs, where CEOs either retire or get bumped up to handle greater responsibilities.

Their departure leaves a void that must be filled and which usually leads to intense lobbying for the positions, especially the potentially powerful ones. It is not uncommon for politicians to back a candidate, supposedly adding weight to his candidacy.

Next year is unlikely to be any different with the likelihood of a number of prominent appointments.

Judging by market banter, there could be openings for the top jobs at, among others, two state-controlled entities — oil company Petroliam Nasional Bhd and unit trust outfit Permodalan Nasional Bhd.

While there is a strong push for the two said jobs, there is also a sub-level of lobbying — for the positions that the shortlisted candidates could be exiting.

One of the names that have cropped up for the jobs is that of Sime Darby Bhd CEO Tan Sri Mohamad Bakke Salleh. While Bakke is not even sure that he will be leaving the plantation giant, the lobbying has already begun for his position in case it becomes available.

Despite all the lobbying, though, the blessing of Prime Minister Datuk Seri Najib Razak is often needed, which means only those trusted by him and approved by him can take the top positions at government-linked companies.

The following are some of the more interesting positions that may become available in 2015 and the candidates jostling for them.

NM_1046_Tan-Sri-Hamad-Kama-Piah-Che-Othman
Tan Sri Hamad Kama Piah Che Othman
President and CEO, PNB

Hamad, who turns 64 next year, has been at the helm of PNB for 16 years. He is said to be looking to relinquish his position as president and CEO of the government-linked investment company.  

He has held various posts in PNB since joining it in 1979 and will likely leave big shoes for his successor to fill. PNB has consistently generated returns of between 6.4% and 7.7% since 1981.

According to its website, PNB manages more than RM255 billion and has investments in more than 200 companies in Malaysia. It has reportedly paid out RM116 billion in returns on investment and in dividends over the past 33 years.

PNB started out in 1978 with a RM2 billion government grant, and has grown by leaps and bounds. A check with the Companies Commission of Malaysia reveals that as at end-2013, PNB had non-current assets of RM28.6 billion and current assets of RM4.1 billion. Its long-term debt commitments stood at RM10.2 billion and short-term borrowings at RM1.3 billion.

For its financial year ended Dec 31, 2013, PNB posted a profit after tax of RM2.5 billion on revenue of RM3.2 billion.

Much of PNB’s success is attributed to Hamad, who is understood to be “looking to take things easy”.

NM_1046_Tan-Sri-Ismee-Ismail
Tan Sri Ismee Ismail
President and CEO, Lembaga Tabung Haji  

At 50, Ismee might be considered too young to lead a large company. However, he has the relevant top-level experience and those who know him say he is capable of handling such a job.

He is also said to be a confidant of Najib and his family, and was appointed to the board of 1Malaysia Development Bhd. More recently, he was made chairman of Edra Global Energy Bhd (formerly known as 1MDB Energy Group Bhd).

Ismee is also likely to be in the limelight with the impending initial public offering of Edra Global.

Prior to joining Lembaga Tabung Haji (LTH), he was head accountant at Pengurusan Danaharta Nasional Bhd, the national asset management company. From December 2001 to November 2003, he was general manager of finance at LTH, after which he left to join ECM Libra Investment Bank Bhd as its CEO.

Among LTH’s main assets is BIMB Holdings Bhd, in which it has 54.7% equity interest. BIMB wholly owns Bank Islam Malaysia Bhd and has a 60.5% stake in Syarikat Takaful Malaysia Bhd.

Ismee also sits on the board of Johor Corp and Felda Global Ventures Holdings Bhd.

Sources say LTH has been searching for Ismee’s replacement and one of the names that has come up is that of Datuk Mohd Radzif Mohd Yunus, the managing director of Small Medium Enterprise Development Bank Malaysia Bhd.

NM_1046_Datuk-Abdul-Rahman-Ahmad
Datuk Abdul Rahman Ahmad
CEO, Ekuiti Nasional Bhd

Abdul Rahman is thought to be another candidate to lead PNB. The Edge understands that he has the support of many intellectuals who can see him and his good friend, EPF CEO Datuk Shahril Ridza Ridzuan, working together.

However, it is known that Ismee is the front runner for the job.

Abdul Rahman, 45, has led Ekuinas since September 2009, when the fund was incorporated.

He has impressive credentials, having been the CEO of government-owned media company, Media Prima Bhd, as well as managing director of the politically connected Malaysian Resources Corp Bhd (MRCB). He also did a stint in Danaharta.

Clearly, Abdul Rahman has built up Ekuinas — as at end-December 2013, the fund had current assets of RM44.9 million, long-term assets of just above RM1 million, short-term debt commitments of RM10.7 million and no long-term borrowings.

In its financial year ended Dec 31, 2013, Ekuinas posted an after-tax profit of RM14.6 million on RM48.4 million in sales.

NM_1046_Tan-Sri-Mohd-Bakke-Salleh
Tan Sri Mohd Bakke Salleh
President and CEO, Sime Darby Bhd    

According to sources, Bakke is a favourite of Najib and could be in a more prominent position next year.

“He’s a simple man, well-liked by all, a capable man,” one of Bakke’s friends says.

The 60-year-old accountant by training had joined the board of Sime Darby in November 2010 and is a former CEO and managing director of Lembaga Tabung Haji.

He had helmed Felda Holdings Bhd prior to the 2012 listing of Felda Global Ventures Holdings Bhd and had worked for PNB in the early 1990s.

Bakke was also head of internal audit at Caltex Oil Malaysia Ltd.

Sime Darby has expanded aggressively under Bakke and recently proposed to acquire New Britain Palm Oil Ltd from rival Johor Corp-controlled Kulim (M) Bhd for RM5.6 billion.

The deal would see Sime Darby pay a hefty premium to NBPOL’s trading price at a time when crude palm oil prices are depressed.

NM_1046_Tan-Sri-Shamsul-Azhar-Abbas
Tan Sri Shamsul Azhar Abbas
President and CEO, Petronas  

Shamsul, 62, has led Petronas since February 2010. His contract ends in early February next year. If renewed, there is likely to be strong protest from Malay rights groups. Some in the oil and gas sector say his policies have not benefitted local companies.

Shamsul has called on Malaysian companies to become globally competitive, but this and higher qualifying requirements for Petronas contracts have seen negative response.

He came under fire from former prime minister Tun Dr Mahathir Mohamad and Umno delegates at the party’s recently concluded general assembly.

Shamsul’s assertion that Petronas may not be able to make its regular dividend payments to the government has also put him in the spotlight. Some ministers insist it is not up to Petronas to decide how much it gives the government.

Given how his efforts at prudence have been received, those close to Shamsul say it is unlikely he will stay on at Petronas even if his contract is extended.  

In an interview with the Financial Times in 2012, Shamsul said he would not stay at his job long “so as to test the company’s new succession policy”.

“I’ve identified my successor and I’m ready to leave any time. Even tomorrow … I don’t believe in self-preservation,” he said.

Shamsul is expected to be succeeded from within Petronas but several outside candidates, including Sime Darby’s Bakke and Lembaga Tabung Haji’s Ismee, are said to be in the running too.  

Internal candidates for Petronas top job

NM_1046_Datuk-Wan-Zulkiflee-Wan-Ariffin
Datuk Wan Zulkiflee Wan Ariffin

Wan Zulkiflee, 52, who was made chief operating officer and executive director of Petronas in April 2012, has been tipped as its future CEO.

During Hari Raya celebrations this year, say observers, Wan Zulkiflee’s open house was busier than usual with many looking to pay homage to the soon-to-be-appointed CEO of Petronas.

Wan Zulkiflee is also executive vice-president of downstream business at Petronas. He had joined the oil and gas company as a process engineer in 1983. He has since held many key portfolios, such as managing director and CEO of Petronas Gas Bhd. He was chairman of Petronas Gas from Aug 15, 2008, to Aug 17, 2010 and has been chairman of Petronas Dagangan Bhd since Aug 17, 2010, and a director of Petronas Chemicals Group Bhd since Dec 15, 2008, which would make him a well-rounded Petronas chieftain, if that comes to fruition.

NM_1046_Datuk-Anuar-Ahmad
Datuk Anuar Ahmad

Anuar’s name was already in the hat in 2010 but the top job went to Tan Sri Shamsul Azhar Abbas.

Together with Wan Zulkiflee and Datuk Nasarudin Md Idris, who now heads MISC, Anuar was one of the favourites to bag the top job.

Anuar retired from Petronas Gas in May this year after turning 60. However, as with Shamsul’s appointment as CEO in 2010, it is clear that Petronas is not averse to bringing back a retired employee.

Like Wan Zulkiflee, Anuar is well experienced, having worked for various divisions of the oil company.

He had joined Petronas Dagangan in 1977 and held various senior managerial positions, including in the international marketing division, corporate planning unit and Petronas Trading Corp Sdn Bhd. He was also managing director and CEO of Petronas Dagangan, vice-president of oil business at Petronas and a director of Petronas Chemicals Group from June 2010 to September 2011.  

Most oil and gas pundits, however, say Anuar is a dark horse in the competition.

moving_up
Tengku Datuk Zafrul Tengku Abdul Aziz
Acting group CEO of CIMB Group Holdings Bhd, CEO of CIMB Investment Bank Bhd

NM_1046_Tengku-Datuk-Zafrul-Tengku-Abdul-AzizTengku Zafrul, or Zaf as he is popularly known, is likely to be made full-fledged CEO of CIMB Group, taking over from the accomplished Datuk Nazir Razak.

Nazir is now chairman of CIMB Group after having been its CEO for 15 years, possibly paving the way for Zafrul’s appointment.

Considering ongoing merger negotiations between CIMB, RHB Capital Bhd and Malaysia Building Society Bhd, Zafrul might become the CEO of Malaysia’s largest banking group. 

Prior to joining CIMB, he was CEO of Maybank Investment Bank Bhd until December last year and did stints in K&N Kenanga, Avenue Securities and Citi Group, among others.

He left Maybank Investment after a valiant attempt at becoming managing director of its parent company Malayan Banking Bhd (Maybank). Zafrul and four other candidates were pitted against each other for the position and it went to Datuk Abdul Farid Alias, who was appointed president and CEO of Maybank in August last year.

Three months later, Zafrul left for CIMB.  

How Zafrul fares as CEO of a giant banking group will be scrutinised by the entire banking fraternity and Corporate Malaysia.

moving_on
Datuk Voon Ting Yow
Acting president and CEO, S P Setia Bhd

NM_1046_Datuk-Voon-Ting-YowVoon leaves S P Setia on Jan 1, 2015, after 17 years, to pursue his “own interests”.

He was appointed acting president and CEO of the company in May 2014 on a one-year contract and was not scheduled to leave until end-April 2015.

Voon had replaced long-standing S P Setia head honcho Tan Sri Liew Kee Sin, who is now with Eco World Development Group Bhd. Liew and other top management of S P Setia, including chief financial officer Datuk Teow Leong Seng, had resigned in January 2014.  

Considering that Liew, Teow and Voon had been together in S P Setia for almost two decades, Voon might resurface at Eco World.

Taking over from Voon will be Datuk Khor Chap Jen, S P Setia acting deputy president and chief operating officer.

Another possible successor is said to be Datuk Jamaludin Osman, CEO of Island & Peninsular Group Sdn Bhd, which, like S P Setia, is a PNB-controlled company. Jamaludin has been its CEO since October 2004.

Whoever comes to S P Setia will have measure up to Liew and now Voon. — By Jose Barrock

This article first appeared in The Edge Malaysia Weekly, on 22 - 28 December 2014.