By Shannon Teoh
KUALA LUMPUR, Feb 23 — Tun Dr Mahathir Mohamad brushed off today Datuk Zaid Ibrahim’s call that he “write a book” on why Malaysia Airline System (MAS) was privatised to Tan Sri Tajudin Ramli in 1994, saying he was not in charge of the loss-making national carrier.
“I’m not in charge of MAS, how can I write a book? I can make some comments, that’s all,” the former prime minister told reporters today.
Zaid, who was de facto law minister in 2008, wrote in his blog today that Dr Mahathir (picture) must explain by “writing (a book) that is believable, that at least reflects the true situation surrounding the MAS saga that has still not been resolved until today.”
Zaid, who resigned from Umno in September 2008 to join PKR but is now estranged from Pakatan Rakyat (PR), has backed the opposition’s criticism of recent confidential out-of-court settlements between Tajudin and several GLCs.
“Since the settlement was conducted in secret, allow me to guess the terms of the deal: Tajudin was not required to pay a single sen to Danaharta or any of the GLCs; instead, the government will pay Tajudin RM6.5 billion (or half of what he had claimed).
“Tajudin will then be generous in his contributions to the party coffers for the upcoming general election,” he said.
Tajudin’s settlement with Pengurusan Danaharta Bhd (Danaharta) on February 14 came after a lengthy legal dispute following a High Court decision in December 2009 ordering the ex-MAS chief to pay the state asset management manager RM589.14 million plus two per cent interest per year, backdated to January 1, 2006.
But Dr Mahathir, who was PM from 1981 to 2003, insisted today “the government is very sensitive to these things because it may affect the image of the government and the support in the next election.”
“If they have evidence that there was blatant abuse of power they can make a case for it,” he added.
Tajuddin, who was MAS chairman until 2001, was also a poster boy of former Finance Minister Tun Daim Zainuddin’s now discredited policy of nurturing a class of Malay corporate captains on government largesse during the Mahathir administration.
The case between Danaharta and Tajudin arose after he executed a facility agreement on July 13, 1994 to borrow RM1.79 billion from a group of syndicated lenders to finance his purchase of a 32 per cent stake in MAS.
However, from 1994 to 1998 he failed to service the original loan, causing it to become a non-performing loan (NPL).
In 1998, Danaharta acquired the NPL from the lenders but Tajuddin also failed to settle his debt to Danaharta until it was in default of RM1.41 billion as at October 8, 2001.
As part of a settlement agreement, Tajudin was to pay RM942 million in four instalments over three years and that he was permitted to redeem his charged shares at a minimum price per share.
Tajudin, however, defaulted in the payment of the quarterly interest payable under the settlement agreement and on April 27, 2002, the plaintiffs terminated the settlement agreement and demanded RM1.61 billion from him.
On April 29, 2002, Danaharta, together with its units Danaharta Urus Sdn Bhd and Danaharta Managers Sdn Bhd sold part of the charged shares consisting entirely of Technology Resources Industries (TRI) shares at RM2.75 per share, resulting in total proceeds of RM717.39 million.
As at December 31, 2005, the amount outstanding was RM589.14 million and on May 11, 2006, Danaharta and the subsidiaries commenced action to recover the money.
Tajudin had alleged in his affidavit that it was Dr Mahathir and Daim who directed him in 1994 to buy a controlling stake in MAS to bail out the government.
Tajudin claimed that his purchase was a forced “national service”, disguised as an arm’s length commercial deal, because the government wanted to appease the investment community and the public.
Dr Mahathir, however, denied in his autobiography published last March that he and Daim had forced Tajudin to bail out MAS in 1994 for RM1.8 billion, claiming instead that Tajudin was “elated” over his purchase.
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