by Ganesh Sahathevan
May 30, 2017: MAS serves notice of intention to issue a six-year prohibition order each against Kelvin Ang Wee Keng and Lee Chee Waiy, former NRA Capital head of research; and a three-year ban against Kevin Scully, CEO of NRA Capital. Lee was found to have applied inappropriate methodology and assumptions in the valatiuon of Saudi oil company PetroSaudi Oil Services. Scully failed to ensure that Lee exercised sufficient care, judgement and objectivity in the valuation of PetroSaudi, MAS said.
That PSOL be over-valued is relevant to the value of the so-called “Cayman units”.As 1MDB stated:
“In June 2012, the entire USD1.83 billion amount invested by 1MDB in murabaha notes (in the JV with PSI) was repaid, by way of conversion into shares of Petrosaudi Oil Services Limited, for a value of USD2.22 bil,” it said.
In September 2012, 1MDB sold its shares in PetroSaudi Oil Services Limited for US$2.318 billion and received fund units in a Cayman registered fund.
The Cayman registered fund is managed by Bridge Partners, a Hong Kong-based fund manager. These fund units were owned by 1MDB via its 100% subsidiary, Brazen Sky, and held through BSI Bank Singapore as custodian.
These same units are now to be part of the 1MDB-IPIC settlement but given that the base valuation was false, the value of the “Cayman units” must also be considered to have been compromised. The reason is simple.The “Cayman units” are supposed to be units in a segregated portfolio fund .Being segregated the fund could only have been financed by the PSOL shares,either in cash (if the fund manager liquidated them) or in kind.Put in another way, this is ,in investment terms, a case of garbage in, garbage out.
In addition , as this writer has demonstrated, the series of transactions that led to the acquisition of the Cayman units were entirely cashless(see articles below)
“The Cayman registered fund is managed by Bridge Partners, a Hong Kong-based fund manager.
“These fund units were owned by 1MDB via its 100 percent subsidiary, Brazen Sky, and held through BSI Bank Singapore as custodian,” it said in a statement today.
Wednesday, April 22, 2015
1 MDB audit: AG must & will find that loss of RM 7 billion in cash was in accordance with proper procedures,accepted accounting practise