KUALA LUMPUR (Oct 30): Khazanah Nasional Bhd (Khazanah)’s assets divestment exercise over the year only involved commercial assets and not strategic ones, said Economic Affairs Minister Datuk Seri Mohamed Azmin Ali.
He said the liquidated assets had achieved its commercial target to generate revenues.
“Firstly, it was to pay Khazanah’s debts, not government debts and secondly, to be reinvested in new investments for Khazanah’s strategic assets,” he said when winding-up debate on the Supply Bill 2020 at the Dewan Rakyat here today.
Mohamed Azmin also said that Khazanah remained the largest single shareholder in some of the country’s leading government-linked companies (GLCs).
As of Sept 30, 2019, Khazanah’s strategic stake in Malaysia Airports Holdings Bhd was 33.21 per cent, Telekom Malaysia Bhd (26.15 per cent) and Tenaga Nasional Bhd (27.27 per cent), he added.
For the financial year of 2019, he said Khazanah was expected to chalk up profits of around RM5 billion compared with losses of RM6.3 billion in 2018.
“As Khazanah does not receive fund injection from outside sources for its investment, proceeds from the disposals are the new main source for new investments, unlike the Employees Provident Fund and Permodalan Nasional Bhd which receive funds from employees contribution and unit trusts, respectively.
“The assets disposal also depends on time and market strength as well as buyer's availability, quality and credibility,” said Mohamed Azmin.
He said between May 2018 and June 2019, Khazanah had disposed of assets worth RM18.8 billion, of which RM3.2 billion was between May to December 2018, and RM15.6 billion from January to Jun 2019.
Of the proceeds from the disposals, he said Khazanah had invested RM6.4 billion in the various sectors, debts repayment (RM8 billion) and RM1 billion paid to the government as dividends.
Azmin added that the remaining of the proceeds was kept as cash for future investment purposes.
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