KUALA LUMPUR (July 15): In hindsight, former 1Malaysia Development Bhd (1MDB) chief executive officer Datuk Shahrol Azral Ibrahim Halmi (pictured) had conceded that Goldman Sachs' investment banking head in Southeast Asia Tim Leissner and his team had misled the investment fund’s board of directors with regard to the RM10.64 billion acquisition of Tanjong Energy Holdings Sdn Bhd.

Defence counsel Wan Aizuddin Wan Mohamad referred Shahrol to the projections made by Leissner, together with 1MDB legal officer Jasmine Loo and fugitive Low Taek Jho, or Jho Low, on the profits that would be made after 1MDB acquired the power assets.

However, Shahrol maintained that he was not a party in those discussions and as such, was not involved in making the "overpriced" projections.

Wan Aizuddin: I put to you that Leissner had misled the board in terms of the projections.

Shahrol: Agree.

Wan Aizuddin: I put to you that you gave them overpriced projections, so that you could make Goldman more profits.

Shahrol: I disagree.

Wan Aizuddin: I put it to you that they intentionally misled the board.

Shahrol: I disagree, at the time I wouldn't know.

Wan Aizuddin: But in hindsight, do you agree that Leissner and the others have misled the board?

Shahrol: Agree.

Wan Aizuddin: Did Goldman breached its fiduciary duty as a financial advisor to 1MDB in getting the deal?

Shahrol: Agree.

Wan Aizuddin: There was also a breach of fiduciary duty on your part.

Shahrol: I disagree.

Earlier, Wan Aizuddin argued that there was no hard evidence for Shahrol to prove that the Tanjong Energy deal was going to be profitable.

In response, Shahrol defended that they were mere projections. "You can't have hard evidence because these were just projections, [for example], if certain plants were built, etc," he said.

Shahrol added there were income projections on Leissner's presentation slides showing that there were positive cash flows that would be sufficient to service the debts.

However, he admitted that the projections were never met. As for making profit, Shahrol said he did not know as he left the role in 2013.

Interestingly, Shahrol had earlier during the cross-examination today defended his decision to engage with Goldman for the Tanjong Energy deal, claiming that the bank's works were "exemplary".

Shahrol said the recommendation to the board was made because he could see that the bank worked hard and had good feedback from the 1MDB acquisition team.

He said Goldman leveraged its own stellar international leverage whenever they had issues with the acquisition.

"I saw that as a value-added service by Goldman," he said.

Wan Aizuddin: Was it because you were in collusion with them to receive remuneration for securing the deal?

Shahrol: I disagree.

Previously during his testimony, Shahrol testified that Goldman Sachs was first involved as a financial advisor to Terengganu Investment Authority Bhd (TIA), with the same officers from Goldman Sachs, namely Roger Ng and Tim Leissner, who he claimed were really close to Jho Low.

Then, Goldman Sachs was again appointed as financial advisor to 1MDB for the acquisition of Tanjong Energy. The acquisition was said to be a good opportunity for 1MDB to venture into the energy field in Malaysia and enable the energy sector to be under the control of a government-owned company, namely 1MDB.

Stay safe. Keep updated on the latest news at www.EdgeProp.my 

Click here for more property stories.

SHARE
RELATED POSTS
  1. Chong Hong Chuon confirmed as AmFIRST REIT CEO
  2. Sunway REIT deputy CEO Chen Kok Peng assumes role as CEO as part of succession planning
  3. IOI Properties reappoints Lee Yeow Seng as CEO