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Sakmongkol ak 47

Thursday 1 March 2012

The future of FELDA after the LISTING

We have to interrupt the series on the Superhuman of Malaysia with this breaking news.

It’s about the Felda FGV listing. The question we should ask all thought leaders of FELDA is this. Why should a loss making business entity, be allowed to do a reverse takeover of FELDA holdings? FGV owns 49% of FELDA Holdings which has been making money all the time. FGV hasn’t got a track record and has no standing at all to come out with this proposal in the first place.
FGV is the business unit formed while Dato Bakee ( who is now Sime Darby CEO) was in FELDA. The idea of forming FGV to carry out international businesses was proposed by Ethos Consulting group. That adds some flavor to the meal.
Can FELDA tell everyone, how much did FGV lose really? We were only told of losses amounting to RM 500 million. One thing we do know is, FGV is consistent. It has CONSISTENTLY lost money for 5 consecutive years. Perhaps Dato Sabri Ahmad can disclose fully and honestly, how much FGV lost during those 5 years. Maybe he has gone to the PM and reported everything is OK sir. Najib is pleased to hear that kind of story.
If FGV lost money over 5 consecutive years that would strongly suggest that it is incompetent. Two, it would also suggest, just as in most GLC’s subsidiary companies, some people got very rich while the companies they helmed suffers financial hemorrhage. Before FGV comes along and wishes to take FELDA Holdings, it must come clean about itself.
The next big question is what is the purpose of this listing? Is it an attempt to save a losing business concern (FGV) itself? Is it done to raise money for FELDA? FELDA has a lot of money. It has the mother lode of financial resource which is provided by their palm oil plantations. Unless you are a super moron, all plantations make money.
Everyone is talking about the good things that come along with the heist-ing listing. Because everyone can cook up a good story. MAS was making money and doing fine, when suddenly some smart alec suggested that it was good to privatize MAS. So Tajuddin Ramli in the name of service to the nation agreed to take 32% of MAS provided he was given a guarantee over his purchase of the share. Mahathir gave him that because he considers Tajudin as a captain that can pilot the NEP objectives.
Likewise you can see the chicken shit analyses over the benefits of the listing. Good analyses are a dime a dozen. That fat slob with the lard layered brain can always do that for a fee. So, can we ask FELDA how much they paid Ethos to come out with the listing proposal? It must be a large amount, sufficiently large to allow a leading member of Ethos to buy a RM 15 million penthouse unit in an upscale condominium.
So, we ask Dato Sabri, how much did FELDA pay Ethos?
Up to this point, we have asked him 2 questions. (1) How much did FGV lose really and (2) how much did FELDA pay Ethos?
This loss making business entity promises the moon and stars to FELDA settlers. What is the basis of its promises? It is run by incompetents which is the only thing that can explain why it’s making losses over 5 years. It simply doesn’t have the wherewithal to bring the listed and enlarged FGV to new heights. So how can it makes promises?

Because the PM guarantees it says Chairman Isa. Coming from someone who has made a mess of Negri Sembilan- now that’s something. Isa is the man of Mahathir’s heart. The captain of the NEP.
The government is bent in seeing the listing. Why the insistence? Ahmad Maslan said the listing exercise will raise RM 21 billion.
How much will FELDA get?
I was told that Dato Sabri told the PM, the bulk of the money raised will be channeled to the PM’s department. The PM is elated at the prospects of getting RM 13 billion or so. He can go back to Pekan and replace all the dilapidated hoses of the rakyat in Pekan. His generosity will be ululated by the ladies and wanita UMNO Pekan for generations to come.
As to FELDA, FELDA will probably get RM 8 billion. That will mean PM department will get around RM 13 billion to allow the PM to play Santa Claus for a long time like in the above example we gave.
What will FELDA do with the RM 8 billion? Since it has borrowed money from EPF, it must now pay EPF. The outstanding is about RM 3 billion. If FELDA pays RM 3 billion, it is left with 5 billion. From this 5 billion, it must pay the windfall to FELDA settlers- 112,000 of them. That will probably mean another RM 2 billion gone.
Yes, my FELDA brothers-It’s not FGV or the government that will pay the windfall. That money comes from FELDA itself out of the profit share it gets from the listing. The biggest beneficiary is the PM’s department which will get some 13 billion from the listing exercise. That is why the PM supports the listing of an otherwise loss making concern.
With RM 3 billion left, Felda can operate at its current level of providing benefits to the 112,000 settlers in the various FLEDA schemes for only one year. After that, it will be reduced to a beggar.
We come now to the biggest question about FELDA itself. With the listing, what will the settlers lose? It will lose the bulk of revenue. How come? It will immediately lose the 350,000 hectares of oil palm plantations managed by FELDA Plantations. The 350,000 hectares of land will be leased to FGV for 99 years.
How much does FELDA need to run its operations? By operations I mean to take care of its operational staff and to carry out much social work in FELDA schemes. FELDA needs around RM 3 billion each year. From its plantation business, it gets about RM 2 billion a year and the balance it gets from its other investments. With the cessation of 350,000 hectares, FELDA is left with about RM 400 million a year.
With the 400 million, how will FELDA provide welfare to the 112,000 FELDA settlers and to FELDA schemes? Perhaps Isa Samad will say the government will guarantee this. Why should the government spend over RM 3 billion a year on FELDA when all this time, FELDA has been self-financing? Why should the government be forced to fork out more money simply because the Felda board and its executives wanted to go listing?
That will be a severe financial drain on the government. Unless of course, it will use the money the PM department gets to make up for the loss of revenue. That will allow the PM to play Santa Claus for another 3 -4 years. But the PM will not use the 13 billion on Felda alone. He needs to take care of the people first and the people are not made up of only FELDA settlers. He needs money to pay UMNO division heads. He needs money to pay dropped candidates who will otherwise go on the rampage. Where will the government get money to give FELDA the finances to carry out its social obligations at the same level it’s now providing?
Has anyone thought about the future of FELDA and FELDA settlers?
What about the terms of the lease? We have not seen the terms of the 99 year lease. How will FELDA get paid? It’s said that FELDA will get paid every quarter? Why every quarter when FGV makes monthly profits? If you lease a house or office building, revision of the rentals or lease are done on say, a 5 year basis. Why is the lease to FGV revisable only at 20 year intervals? How can the FELDA board and those who manage FELDA agree to this scorched earth deal?
Again Sabri Ahmad and Isa Samad must come out with full disclosure about the listing.
Narn  bohtee Narn, Kui bohtee kui!


bruno,  1 March 2012 at 07:22  

Dato,rumours out about one and a half years ago was that FGV has lost around two and a half billion ringgit.Going by their losing track record this could be true.

Anonymous,  1 March 2012 at 08:54  


Hopefully someone can show this bluff to the settlers and draw very clearly durian runtuh vs Felda future loss.

I dont think Isa would be able to answer this nor want to answer this. His stand is only one "This is PM guaranteed and if you do not believe PM than you can get the hell out of this dewan"

Anonymous,  1 March 2012 at 09:20  

Good write-up!!!!!

Yes, right questions for an urgent problem!!!!

Goes for the jugular, & see how the blood fly.

The only handicap would be the forever safe - elegant silence, mastered by these nincompoops.

bruno,  1 March 2012 at 09:40  

Dato,in the actual coporate world,big coporations take over their smaller and weaker competitors to have a better control of the markets for their products.

Then in the takeover world we have specialists and hedge funds who concentrate on takeovers of weak and losing companies,especially companies who are on the brink of bankruptcies.They take over these losing concerns,stripped them stark naked and sell them piece by piece,part by part,like vultures on top of a dead lembu.

But here in Malaysia truly Asia,we have a shell company called FGV,a so called GLC of the corrupted GOM.Because FGV happened to be a GLC,it was loaned 3 billion ringgit by Felda,out of the 6 billion Felda borrowed from the workers retirement fund,the EPF.And the beauty of it is Felda a frofitable cash rich plantation company now has to resort to borrowing too(what happened to the cash of the cash rich Felda one has to figure it out).

And today,the debtor cash poor unprofitable FGV wants to do a reverse takeover of the borrowing profitable company Felda.And this takeover has been pushed forward by politicians and their cronies,who will be handsomely rewarded financialy when the so called GLC FGV is publicly listed.

In the real coporate world even if FGV is being put on the auction block,these so called takeover specialists or coporate vultures as they are famously called will avoid them like avoiding lepers.After all what do FGV have that coporate vultures can feed on.There is nothing they can stripped off GLV except tons of debt.

The GOM will be the laughing stock of the civilised world when the takeover of Felda is completed.It will be a bigger laughing clown of a stupid fool when the only large subcribers for the shares will be from the GLC's.

Anonymous,  1 March 2012 at 09:53  

elok kalau boleh diterjemahkan dalam bahasa melayu dan di sebarkan kepada seluruh peneroka felda...

ordinary malaysian 1 March 2012 at 10:07  

That,in a nut-shell, Datuk, is what the GOM should explain to the Felda settlers. Then, tell the settlers what will happen to Felda's land eventually. After that, tell the settlers that they will become fatter and richer. Najib says so, and Isa echos.

manfrommachap 1 March 2012 at 10:31  

When it is made too difficult for the poor Felda folks to even come out with a question to question the "behind the scene" consequences, the next best thing to do is just to shrugged the shoulder and accept whatever that is coming. The "trust Najib " gimmick is just to strengthen the strategy.

I sincerely hope that there will be people from the opposition who can relate the detrimental conseqwuences of this listing exercise which "kaki lutu" only bloats about the settler's peanuts but deviously hides his millions from the deal, the boy from the fourth floor's lottery strike and more importantly, Najib's "durian runtuh". A simple case of "I will dictate to you what I will do with your money and here a doller and go play far far away and keep your mouth shut"

Anonymous,  1 March 2012 at 11:10  

I like your Hainanese phrase : " Narn Bohtee Narn, Kui Bhtee Kui".

It beautifully sums up all these people's characters and morals.

Suci Dalam Debu 1 March 2012 at 11:51  


I will always salute you.

Anonymous,  1 March 2012 at 14:12  

Dear Dato,
If they were really sincere in helping the settlers and the nation they would surely to listed the KPF as it would be a much easier task. However, you may have known the PM personally and how his operative..
I may suggest you should link the highlight to the correct person, then it may posses better outcome.. in this case the loving wife!

Richard Cranium 1 March 2012 at 14:32  

Sounds like the settlers have been fooled i.e. I've seen this in private sector M&A's as well. The "investor" supposedly buys your company, pays you from the cash reserves already in the company. They are using your own money to pay you.

I liked your rendition of the Hokkien saying, but I thought it was "lang bohtee lang, kui bohtee kui*"..?

*Manusia tak serupa manusia, hantu tak serupa hantu. Or, something like it.

Anonymous,  1 March 2012 at 14:47  


I just love reading your blog. TQ

Anonymous,  1 March 2012 at 15:13  

Ultimately, Dato, it's for the FLEDA settlers to decide on their future.
We can make all the noise we want, the PM will not care a damn.
Unless there is revolt among the settlers, the listing will be a reality.
But the irony is, the rural Malays can fooled all the time. That is why they are still supporting UMNO.

elizabeth 1 March 2012 at 16:13  

Dato, to commit to FGV a lease of 99 years is as good as outright sale. The other critical issue is the amount of rental. I think there is a plantation reit that is listed on Bursa. In that business model, they rent the plantations out, but rentals are renegotiated on a 3 year interval. As the fortunes of plantations are tied to cpo price, the tenant of the estates also have a profit sharing arrangement so if CPO price shot up to RM4k, not just the tenant profit, but the land owner also get to enjoy the windfall. In the book the good earth, the peasant by hook or by crook invested in accumlation of land. The FGV IPO will turn the settlers from being landowners to defacto tenants. I was told by lawyers that, if we enter into leases of properties for a tenure of more than 3 years, the lessees will have rights to the land. The FGV is another form of land grab, as I see it.

Anonymous,  1 March 2012 at 16:19  

Dato what do the Hindustani words at the end of your v good writeup mean?

Anonymous,  1 March 2012 at 16:41  

There's nothing like the feel of hard cash in your hands. Felda settlers will fall back in line behind UMNO once they feel that cash. The worries for the future will easily be forgotten in the euphoria.

And the settlers' staple media like Utusan and BH will sing praises for UMNO that it kept its 'promises' to them.

This mega listing will lift the stock market and the Chinese will be jumping for joy.

Ahh... right time to call for GE !!

Donplaypuks® 1 March 2012 at 17:29  

"Ahmad Maslan said the listing exercise will raise RM 21 billion."

I think he said the market capitalisation will be $21 billion i.e. total no. of shares x KLSE value per share after listing.

Thta's not the same thing as saying the listing will raise $21 billion. Not unless they get EPF & PNB/Khazanah to buy over all the shares! God forbid.

we are all of 1 Race, the Human Race

Anonymous,  1 March 2012 at 17:47  

Abraham Lincoln may be wrong on this one....Indeed you can fool Felda folks anytime and every time.

That's why there are Umno sponsored thugs in all Felda scheme to prevent opposition from spelling out the facts.

Anonymous,  1 March 2012 at 18:28  

From 2009 onward, various media have reported that FGV has expansion plans with a total value of RM6b (the same amount that was taken out of EPF last year):

- 100,000 ha in Amazonas, Brazil (reportedly cancelled after causing international uproar among conservationists)
- 105,000 ha plantations in PNG
- 45,000ha plantations in Aceh, Indonesia
- 20,000ha “nursery” in Kalimantan
- Plantations in Cameroon
- Plantations in Liberia
- Expansion on NCR land in Sarawak
- around 160,000ha in Cambodia

All this under the banner of "Exporting Poverty Alleviation". But none of the countries and regions mentioned above offer the same conditions as those of the 1950s in Malaysia. It is very doubtful that the expansions abroad will be viable.

Deutsche Bank and JP Morgan better be very careful with endorsing this highly suspect Malaysian IPO.

Anonymous,  1 March 2012 at 18:49  

If FELDA eventually got listed, who is going to mop up the unsubscribed shares? EPF kah? Just like kah? we contributors become suckers again?

Anonymous,  1 March 2012 at 19:53  

"If FELDA eventually got listed, who is going to mop up the unsubscribed shares?"

All shares will be fully subscribed. Hard cash from Government-controlled institutional funds like PNB, EPF, Tabung Haji are there for the taking.

This mega listing is engineered to siphon money from these funds in a seemingly legitimate business investment in a newly listed company.

Vietnam Mari 1 March 2012 at 21:08  

Lang Botee Lang ! Kui Botee Kui !

or in Han Yu Pin Yin

Ren Bu Xiang Ren ! Gui Bu Xiang Gui !


Not all Chinese can understand you Hainan Saying ! You must have had a good Hainanese buddy during the course of your passage thru life !

Literally " Looks Like Human but not Human ! Look like Ghost but not Ghost ! "

Vietnam Mari !

bruno,  1 March 2012 at 22:02  

Dato,if the listing of FGV finally goes through,how about the orang putihs.The orang putihs will be the spectators,judges and jury,watching,laughing and cheering on the sidelines.Finally when the results of the major subscribers are announced,their verdict will be the actions of the GOM "a major first class circus clown act".

Anonymous,  2 March 2012 at 07:58  


Banyak duit tu!!!!. Pink form sapa yg dapat????? Easy money...from the people to me and me and me...laughing all the way to bank. Tak nak lagi??????

Anonymous,  2 March 2012 at 11:30  

The listing will go ahead.I am saving my money to subscribe.At least i know it will be professionally managed.Felda need to be a global player.If most of the Felda people and their top managent do not violently object to this listing who are we to say otherwise and speculate.


abdul,  2 March 2012 at 12:02  

All successful companies are run by competent manangers with strategic vision and good entreprenual skills which is sadly lacking here. In addition you have a corrupted Chairman, supported by apple polisher politician are clear signs that the whole exercise are going to the dogs!

Sutra Felda,  2 March 2012 at 14:38  

Macam-macam boleh;

Sutrajaya Shipping Sdn Bhd apa dah jadi.

Biaqpilah konon-nya anak2 Felda dah lupa dengan visi dan misi. Felda mempunyai aspirasi ...

We share Felda's aspiration to be the world leader in the palm industry.

We leverage on our core business to further expand into other maritime business.

We are business entity that continuously strives to improve the quality of services to our customers.

We care for the employees, nation and the environment.

- ex MT Sutra 2 -

yapie,  2 March 2012 at 17:37  

My advise to Felda settlers is not to engage in any business that you will unable to see the Account book.

So if the Listing goes on... u will be a very small director lol.... u will be at the mercy of the CEO on all the dividend and subsidary that will be share with u.. in simple.. to control the Felda area vote BANK.... see the picture?

elizabeth 2 March 2012 at 23:21  

Felda settlers should study the alhadharah bousead reit which is listed on bursa malaysia. The rental rates are revised every 3 years. Rental rates are set based on a reference cpo price. If there is an upside to the cpo price, the land owner (in this case the reit) gets to share 50% of the upside. If cpo price is lower than the ref price, there is no co-sharing of loss. The lease beyond an initial short period of say 3 to 6 years, are cancellable. If a small reit that is profit driven owning less than 30k ha can have such reasonable and well organised terms, why FGV cannot give the settlers the same or better deal, and with more transparency and specifics?

Anonymous,  2 March 2012 at 23:21  


you insolent fool. If the PM guarantees it, that means it's better than GOD's guarantee.

Have you forgotten the humility and subservance that you must demonstrate to your top leader. Everything the PM says is divine!!!

So, the listing MUSt go ahead.

jaja 2 March 2012 at 23:53  
This comment has been removed by the author.
Anonymous,  3 March 2012 at 07:47  

The government supports that decision.

When Pakatan takes over Putrajaya, we want an RCI on all operations of GLCs.
No bail outs.

Anonymous,  3 March 2012 at 08:37  

Dear Anon March 1,7.30 pm,

What do you mean the top management did not violently object?Do u know the DG and DDG of Felda has been put away now by Isa Samad?Do u know the National Settlers Head,Pak Sam been insulted by Isa Samad openly in the famous 'Lutu' incident?Do u know that the settler's head of each Felda region made a press conference covered by Harakah rejecting this deal?Pak Sam has made his statement via can type sembangpeneroka to find him.Do u know the head of FGV,Dato Sabri Ahmad was found guilty siphoning RM120by KPMG Forensic while he was at Golden Hope,was asked about this in the parliament (hansard proven) and was asked to resign not long after and now team up with corrupt Isa Samad to lead this listing?Do u know apart from oversea partner,they targeted tabung haji,EPF and state government to subscribe FGV shares?meaning they target rakyat money 1st,personal money u think facebook when listed target US govt or its states to buy?No we know if every FB user buy,it would be more than enough.good luck with ur menabung dari kecil money..

Anonymous,  3 March 2012 at 10:20  

A very good article exposing the shenanigans and scams hatched by the UMNOputras to rake in extra billions on top of the billions they have already looted from the rakyat.

Will this article ever see the light among the FELDA settlers? A big NO. The MSM will assiduously refrain from publishing the truth. It will always glorify the GREAT LEADER who has divine powers to foresee the future. In fact he has become so powerful, the UMNOputras pray to him and for him to be the lead corrupter and pilferer in the country.

Pakatan Rakyat, especially PKR and PAS should find ways and means to reach out to FELDA settlers and other rural folks.

They should disseminate all the scandals associated with UMNO/BN, with particular reference to the FELDA RIP-OFF scheme. The Dato's article should be translated verbatim in Bahasa Malaysia so as to drive home the point that it is not an anti-UMNO article by Pakatan Rakyat but one written by a concerned Malay.

UMNO was thoroughly corrupted by the evil Mamak Kutty for his various nefarious schemes to enrich himself, his family and his cronies. Even now with one foot in the grave, the non-repentant mamak is all out to fool the Malays into believing the non-Malays are their enemies. In fact it the pseudo Malay like the Mamak and the greedy UMNOputras that have highjacked the economy for their own good with the NEP.

Now Najib and his cronies are trying to show they are better thieves than the Mamak.

The FELDA settlers should show their displeasure during the 13th GE by voting for the OPPOSITION.

It is absolutely true what they say about birds of a feather flock together. He has all the crooks in the cabinet with the inclusion of even those discarded by the rakyat during the elections.

Najib is the grand master-leader of the UMNO/BN thieves, robbers, looters, rent-seekers, thugs and racists in the country.

Anonymous,  7 March 2012 at 16:33  

Sak, what should i say but respect for you.
Narn bohtee Narn, Kui bohtee kui!
thought it rang a bell, ha ha ha
ping you Sak !

All the best to you, narn si narn hor hor nan,
hor hor ping you lu si DAP & Rakyat !

Anonymous,  7 March 2012 at 16:42  

Dear Dato,
The peasants FELDA settlers have always been hoodwinked by globetrotting Malays aristocrats. The past outgoing CEO of FELDA is the elder brother of current FT Minister. Do we think these aristocrats really care for the peasants?

Anonymous,  7 March 2012 at 19:40  

Dear Anons
3 March 2012 08:37
3 March 2012 10:20
7 March 2012 16:42
Brilliant articles ! The whistle blowers that are truly mindful of the Rakyat ! Personally i am grateful to the sincere and very good natured Kampong Man for recommending Sak and Aspan's blogs. Haven't heard from him for some time, jangan -jangan boss apa nama - thir bising !

Anonymous,  11 May 2012 at 16:53  

Very rarely do we, the readers come across a person who can cut across all the jargon and produce a masterpiece.Dato', you are amongst the rarity.A real Malaysian at heart.

Ainaq 28 June 2012 at 14:35  

Early stage of FELDA establishment was a gamble forming a socialist farm(land distribution to the people) and modeling after capitalist model. Borrowing money for development. It was first marriage between socialism and capitalism. The opposition at that time sloganised LKTP (Malay Version of FELDA- Lembaga Kemajuan Tanah Persekutual) as Lembu Kerajaan Tengah Panas!!! After years finally we really Tun Razak idea was right. It had transformed unemployed rural youth to esatate workers and land holders as well.Second generation Settlers have found other opporunities outside agricultue ,many in urban/global world( Industrialise and services) land holding will be fragmented as in Kampung days in 1950-1970s... Converting to share is a pratical method rather than the land it self to un economic size. NOW THE DUTY IF TO MAKE IT VIABLE and in the long run growth and profit.

Ainaq 28 June 2012 at 14:36  

Early stage of FELDA establishment was a gamble forming a socialist farm(land distribution to the people) and modeling after capitalist model. Borrowing money for development. It was first marriage between socialism and capitalism. The opposition at that time sloganised LKTP (Malay Version of FELDA- Lembaga Kemajuan Tanah Persekutual) as Lembu Kerajaan Tengah Panas!!! After years finally we really Tun Razak idea was right. It had transformed unemployed rural youth to esatate workers and land holders as well.Second generation Settlers have found other opporunities outside agricultue ,many in urban/global world( Industrialise and services) land holding will be fragmented as in Kampung days in 1950-1970s... Converting to share is a pratical method rather than the land it self to un economic size. NOW THE DUTY IF TO MAKE IT VIABLE and in the long run growth and profit.

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