KUALA LUMPUR (Oct 10): Putrajaya has been urged to be more discerning in planning its investment exercises as the stock market sentiment and investor confidence may be ratttled by any hint of a reversal of such endeavours.
Citing the recent collapse of a deal to sell a 33% stake in Boustead Plantations Bhd (BPlant) to plantations group Kuala Lumpur Kepong Bhd (KLK), former second finance minister Datuk Seri Johari Abdul Ghani said in Parliament on Monday that any government investment U-turns will shake public confidence.
The Titiwangsa Member of Parliament said that when the government makea an announcement, and the investing public has already agreed, they react positively.
“After that, if we reverse course, it causes people to lose confidence in our capital market,” he said.
Meanwhile, Defence Minister Datuk Seri Mohamad Hasan told the Dewan Rakyat that the Armed Forces Fund Board (LTAT) has to proceed with the buyout of BPlant even after the proposed stake purchase by KLK fell through, to safeguard the interest of the plantation group’s shareholders as well as to protect LTAT from potential legal action.
Johari, who was speaking during question time after Mohamad Hasan had explained the financial and investment position of LTAT, said the government must grasp the intricacies of investment practices involving the purchase and sale of shares, including highlighting instances involving Permodalan Nasional Bhd and Boustead itself.
Johari said that in the end, the government ends up owning all these assets that do not provide benefits when such investment plans collapse.
Source : THE EDGE