Halim Saad Anwar Requested Me To Buy Renong Shares To Shore Up Stock Market In 1997 98

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When Prime Minister Datuk Seri Anwar Ibrahim was the finance minister during the 1997/98 Asian Financial Crisis, he had requested Tan Sri Halim Saad to buy shares in Renong Bhd, according to the businessman who was then the controlling shareholder of the debt-laden conglomerate.   (The Edge) – In Halim’s statement of claim (SOC) to his latest lawsuit against Tun Dr Mahathir Mohamad, Tan Sri Nor Mohamed Yakcop and the federal government, he claimed that the request by Anwar was to help shore up the local stock market and prevent Malaysia from losing prized assets, including North-South Expressway (PLUS) which was then a wholly-owned unit of UEM.
Dr Mahathir was the Prime Minister then while Nor Mohamed Yakcop was a minister in the Prime Minister’s Department.
Furthermore, Halim said in the SOC that Anwar was the party who had proposed a put option for him to buy back the block of Renong shares transacted. The put option later became the main point of contention in the Renong/UEM share deal, in which Halim claimed that he had suffered large losses.
According to the SOC, in the upshot UEM bought 722.882 million shares, which was equivalent to a 32.6% stake, in Renong Bhd for RM2.338 billion cash, resulting in the two companies having cross-shareholding. Renong owned a 37.92% stake in UEM.
The cross-shareholding reduced the possibility of a hostile takeover of Renong and indirectly, UEM, Halim said in the SOC.
He said the purchase of Renong shares was approved by the shareholders of UEM at a shareholders’ meeting on Feb 14, 1998. And a put option was in place for Halim to buy back the shares from UEM at cost of purchase plus holding costs less payment of dividend and distribution of reserves (if any).
He claimed that Anwar proposed the put option as a condition for the Securities Commission granting UEM a waiver from making a general offer on Renong after the share purchase as well as to appease the minority shareholders of UEM.
Compensated by only RM165 million
In December 2000, UEM exercised the put option, consequently Halim was obliged to buy the block of Renong shares that cost him RM3.165 billion.
The block of Renong shares would only be transferred to him upon full settlement. Halim said that he made the first payment of RM100 million through a financing facility, and requested more time to pay the second and third instalment to seek approval to bring the funds from overseas.
At the same time, he was planning a bid to take Renong private.
While he was raising funds, the businessman claimed that he was summoned to meet Dr Mahathir and Nor Yakcop on July 12, 2001.
Halim claimed that he was directed not to complete the share purchase via the put option exercise by UEM and also not to launch his takeover bid for Renong.
Halim did not agree with the request to abort its takeover bid.
Five days later, he was informed that Khazanah Nasional Bhd, or an entity it designated, would be directed to make a general offer to UEM and he was required to exit from the UEM-Renong group.
Halim alleged that he was required to support the general offer by PNB and in return he would be compensated if he were to support the takeover offer.
The SOC stated that Nor Yakcop told Halim that immediately upon completion of the general offer, he would be given the following:
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