KL court delay puts Tajudin under spotlight

KL court delay puts Tajudin under spotlight

Wong Choon Mei Reuters Kuala Lumpur

A Malaysian court's decision to delay hearing a plea by tycoon Tajudin Ramli to block the state asset manager from selling shares in Technology Resources Industries, sparked speculation on Monday the shares held as collateral could be sold imminently.

A Malaysian High Court judge decided to put off hearing the TRI chairman's plea until Thursday, without granting a holding- over injunction to stop the state agency, Pengurusan Danaharta Nasional, from selling the shares in the interim.

Danaharta, set up four years ago to take over the banking industry's bad debts, acquired large chunks of Tajudin's 24 percent stake in TRI when he defaulted on personal loans of around one billion ringgit during the 1997-98 Asian crisis.

"The case has been postponed until Thursday. In the meantime there is no holding-over injunction," Danaharta's lawyer Tommy Thomas said after the two sides conferred with the judge in the morning.

Tajudin, the former chairman of Malaysian Airline System and a protege of Malaysia's former Finance Minister Daim Zainudin, is hoping to prevent Danaharta from selling TRI shares held in collateral, while the firm undergoes a US$1 billion recapitalization program.

TRI, the country's second largest cellular firm, is a potential takeover target of state-owned Telekom Malaysia, which has sounded out Danaharta recently about buying the shares.

Last month, TRI sold 1.6 billion ringgit worth of new shares, including 755 million ringgit of rights shares, to cut its debts.

Trading of the rights entitlement ends on Monday, sparking talk that Danaharta might sell Tajudin's stake along with the rights entitlement to preserve its collateral value.

"That's a scenario you can't discount," said a research head at a local brokerage.

But Danaharta might just buy Tajudin's rights shares entitlement, which the tycoon had pledged to buy himself.

The asset manager will seek to protect its investment in case Tajudin defaults on servicing his debt, with the next interest payment falling due very soon, banking sources said.

TRI shares were down one cent at 2.16 ringgit by the midday break on Monday.