Tanjong arranged investors to fund 1MDB RM2b not Ananda Krishnan, says MOF

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KUALA LUMPUR (March 25): The government has revealed the RM2 billion that 1Malaysia Development Bhd (1MDB) obtained to settle its debt to some local financial institutions was actually a loan from private investors that was arranged by Tanjong Public Ltd Company (Tanjong), a company controlled by tycoon T. Ananda Krishnan.

Finance Minister II Datuk Seri Ahmad Husni Hanadzlah stressed the money was not from Tanjung or the tycoon himself, but from private investors.

He said Tanjong undertook to arrange the loan for 1MDB, because the latter had bought over Powertek Energy Sdn Bhd (previously Tanjong Energy Holdings Sdn Bhd) from Tanjong.

"This is arranged by Tanjung because 1MDB bought over Powertek Energy from Tanjong, so Tanjong arranged for private investors to fund RM2 billion, to be paid [to 1MDB] in five months, [and for 1MDB] to pay interest in 6 months, the principal in 15 months, without exchange risk; which means the lender will have to bear the difference from the ups or downs of the exchange rate," he told Parliament today, while wrapping up his debate on the royal address this evening.

He was responding to questions about the source of 1MDB’s RM2 billion fund to settle its debt that was posed by Bayan Baru MP Sim Tze Tzin.

When Sim pointed out that Ananda Krishnan owns Tanjong, Ahmad Husni replied: “No, Yang Berhormat [you] don't understand. I said arranged. The RM2 billion is from private investors, not from Tanjong."

Ahmad Husni also said earlier that Ananda Krishnan did not fund 1MDB, as reported in the media, and that the reports were "untrue".