TigerTalk  |  MARCH 24, 2014 8:43AM

What’s up at Tadmax and why?

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tiger-talk-2zIs there such a thing as a random occurrence in the financial jungle? Tiger thinks not and ponders what changes are afoot at Tadmax Resources. More importantly, Tiger wonders why.

Tiger is bummed. See, the two-legged journalists reported today that the Ministry of Natural Resources and Environment is requesting an additional RM5.6 million to spend on taking care of the two giant pandas we’re hosting.

But what about Tiger and its ilk? Never mind pandas, which clearly don’t belong in our forests anyway, Tiger is more macho, runs the jungle as its king (not an easy job, mind you) and is clearly a more desirable symbol: need Tiger remind everyone that its cousins adorn the country’s coat-of-arms and the country’s biggest bank’s logo, to name a few? Oh wait, Tiger just did.

Alas one lesson that Tiger has learned in its brief years in the jungle is that everything happens for a reason. That reason may not be as sexy or exciting as might be expected in some circumstances, of course, but in the end there is a cause for every effect.

In this case maybe it’s because Tiger hasn’t been doing as much PR schmoozing as the giant pandas’ people… maybe it’s time to hire a couple of PR agencies. Which Tiger would be happy to do if it actually gets some funding.

tadmaxAnyway the financial jungle also works based on the same cause-and-effect principle and it is with this in mind that Tiger tracked recent changes in Tadmax Resources Bhd’s board.

Jungle-dwellers keeping abreast of recent developments would remember Tadmax from the recent controversy around the company’s land sale to 1Malaysia Development Berhad (1MDB) through its wholly owned subsidiary Tadmax Power Sdn Bhd.

Member of Parliament Tony Pua questioned the RM317-million price tag for the 310-acre parcel in Pulau Indah, which translated to RM23.50 per square feet (psf) given that the land was valued at RM9.93 psf in August 2011.

In a statement Pua urged 1MDB to assure that the purchase, which he claims was done at an inflated price, was not a bailout of loss-making Tadmax.

Tadmax CEO Faizal Abdullah

Faizal Abdullah

However Tadmax chief executive officer Faizal Abdullah responded saying that the 2011 value was based on historical cost, citing other valuations of neighbouring land parcels in Pulau Indah hitting the RM21 psf mark back in 2000.

Prior to that land sale, however, there was also the Port Klang Free Zone scandal which involved Tadmax’s subsidiary Kuala Dimensi Sdn Bhd. But Tiger digresses.

Today Tadmax announced the resignation of Tadmax Resources Bhd’s independent non-executive chairman and director Abdul Azim Zabidi in a Bursa Malaysia filing. The only reason stated in the announcement was that Abdul Azim resigned “on his own accord”.

But what does “own accord mean”? Tiger can hardly imagine Abdul Azim, who among others is former Bank Simpanan Nasional chairman and ex-Umno treasurer, waking up one day and deciding that he no longer wants to be involved with Tadmax without good reason.

Therefore clearly that’s not good enough an explanation. If Tiger were a shareholder in Tadmax the alarm bells would start ringing.

Did he leave due to disagreement with other board members? Is the departure related to the lawsuit against him by British investors over the Doxport Technologies Sdn Bhd scandal? Is he being replaced by a major shareholder?

The lack of a clear explanation is alarming. Abdul Azim has been with Tadmax since August 2000 and for him to leave so abruptly “on his own accord” after more than 13 years raises questions.

Tiger notes here that in a separate announcement today, Tadmax announced that it has received a notice of candidate to be appointed as an independent non-executive director of the company. The candidate, Abdul Samad Haji Alias, who is over 70, had consented to the role and Tadmax will seek shareholder approval in a forthcoming extraordinary general meeting (EGM).

Perhaps there is a line to be drawn over these two dots.  Then again Tadmax had seen some boardroom lineup changes recently, which makes Tiger wonder at Abdul Azim’s departure.

Last month another independent non-executive board member, Prof. Drs. Da’i Bachtiar of Indonesia resigned, citing “personal commitment”. Prior to that, two new additions were announced: Noel John Subramaniam is now a non-executive board member while Aldillan bin Anuar was appointed an executive director.

Interestingly Aldillan is son of Anuar Bin Adam, who holds 30.13% of Tadmax at last update. Anuar first surfaced in Tadmax in December 2011.

The only other substantial shareholder of Tadmax is business tycoon and politician Tiong King Sing, whose mailing address listed on the Parliament website is Tadmax’s building Wisma Wijaya Baru in Petaling Jaya.

So if the recent board changes are part of the major shareholder’s initiative to bring Tadmax into the black, it would natural to presume that Anuar is behind them.

But what is he planning? Will he take more control over Tadmax’s management through his son? Is there a masterplan to turn around Tadmax, which has been loss-making since FY08? What does it mean for current CEO Faizal and the rest of the existing management team?

As a public-listed company Tadmax’s other shareholders deserve to know, especially if the real reason is positive news from the major shareholder’s part. Otherwise with Tadmax’s share of the limelight in recent years, unwelcome attention and speculation would thrive.


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