Thursday, July 5, 2012

My two cents on Talam and Selangor State Government deal

Talam (Trinity today) was in a big mess and is still in a big mess today. Before the deal with the Selangor State Government, Talam had over RM2 billion in debt and trade payables whereas its receivables and cash was less than RM280 million. Based on that number, for someone who knows will realize that even if you sue the company, not much can be squeezed out of the company. You would not want to carry your proceedings till the company is under liquidation as that would have woken up all the other creditors.

You would want to privately negotiate, find a solution which both parties could have agreed to and walk away. I think that was what the Selangor state government was negotiating into. The state can't get back cash from Talam as this is the asset which the developer does not have. The only thing Talam has plenty is land and I would think because of the situation it was in, most of these land would probably be encumbered. While I do not like the takeover of the debt from Talam, I think the state government probably had no choice but to accept land partly encumbered. This was a deal which I would go for myself rather than dragging the case for long and not solvable.

Think of this - Today after 2 years the deal was completed, Talam still has over RM1.3 billion of debt and less than RM20 million cash. You think they would be able to pay despite all the legal demand etc.? The best solution is getting some land away from the company as they have plenty. After all it is the state government which gets back their land in their own state.

As for the claim by MCA that the deal allowed Talam to regularize back its PN17 status, well read below, which was announced before the deal with the state was announced.

Whereas, for the claim that the land gotten from Talam was overvalued, well that would be a bit difficult to proof isn't it as it can be quite subjective especially when the amount disputed was RM20,000 per acre.

Basically, this deal is there's no point suing a bankrupt person for bankruptcy - Talam was not bankrupt yet, but it was cashless.

On the other hand, if you really think of it, the party that was smart was Talam, which is what MCA claimed. They are correct here at least.


Anonymous said...

That means even a MB with corporate skills and background can be 'conned' by this company? So much for an overrated Pakatan Gov't.

felicity said...

Well, you have to give it to the state govt. At least they got back in the form of land. Getting all cash from Talam is almost impossible.

Anonymous said...

Well,should go to the bottom of this on how the bn govt got into the mess with talam n wat was their side deal

YTLP investor said...

The Selangor gt may not have gotten the "best" deal but it's a fair one.

The previous administration negotiated a lousy deal, alienating land for project that wasn't delivered. This type of robbery happens day to day and it pisses me off that the politician playing the blame game don't look at the source of the mess and try to mislead the public through sensational headline of nepotism.

It's like the pot calling kettle black...

In Malaysia big scale failure are often nationalised (RM10B to naluri for MAS, RM6B for Star LRT) and success privatised (MEX highway's sale profit of RM1b on the back of government grant).

Absolute power corrupts. There have been a monopoly of the political sphere since 1957. While the opposition may be equally crap but a political rival brings accountability to the table.

The sight of the skyscrapper posing as a billboard in KL makes me sick. Ever wonder where the $$ came from?