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PAC chairman Datuk Shahrir Abdul Samad

"In the ECM Libra-Avenue MERGER , the final evaluation shows there is an enhancement in value, in the shares owned by the government following the merger. But what remains to the PAC committee warrants further briefing from the Finance Ministry is the loss of Control over the merged entity and its policy and strategy"

For the MATRADE building delays: "although direct negotiation was allowed, in this case the ministry should have opted for open tender."

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PAC Finds ECM Libra-Avenue Merger In Accordance With Procedures
August 10, 2006 16:49 PM

KUALA LUMPUR, Aug 10 (Bernama) -- The Public Accounts Committee (PAC), which
sat Thursday on the issue regarding the merger between Avenue Capital Resources Bhd and ECM Libra Bhd, is satisfied that the exercise was done legally and in accordance with the relevant procedures.

PAC chairman Datuk Shahrir Samad said the Securities Commission (SC) had provided a thorough explanation on the issue, but the committee was, however, concerned with the "policy and strategy" adopted.

"The committee is worried of the government losing its control on this new merged entity as Avenue Capital is a government-linked company," Shahrir said.

"We are concerned who will sit on the board and who will regulate the company," he said at a press conference after chairing the four-hour meeting.

Shahrir said that he had requested for the PAC meeting after receiving a lot of information on the merger, which was widely discussed in Internet forums and had raised questions as it involved two well-known personalities.

When asked who the personalities were, he named Datuk Kalimullah Masheerul Hassan and Khairy Jamaluddin.

Shahrir said that the PAC would meet again on Aug 25 for further clarification from the Finance Ministry, which also addressed the forum today, on the policy aspect. -

Problems Of Matrade Building Began With Direct Negotiation Decision ; August 10, 2006 23:00 PM

KUALA LUMPUR, Aug 10 (Bernama) -- Problems that plagued the Malaysia External Trade Corporation (Matrade) building began after the Finance Ministry decided to award the construction contract through direct negotiation, the Public Accounts Committee (PAC) said Thursday.

PAC chairman Datuk Shahrir Abdul Samad said that although direct negotiation was allowed, in this case the ministry should have opted for open tender.

This was because construction of the building did not require specific expertise available only from certain suppliers, he told reporters after chairing a PAC meeting with officials of the Finance Ministry and the Ministry of International Trade and Industry at Parliament House.

He said PAC was told the decision to use direct negotiation was made because Matrade wanted the building completed on a fast-track basis.

"This could still have been done via open tender which would have taken only three months," he said.

Shahrir said PAC proposed that the conditions for direct negotiation be tightened because it was clear that in the Matrade building, the Finance Ministry had failed to adhere to the procedures set by the government.

"We hope what happened in Matrade will be a lesson to the government not to be too hasty in opting for direct negotiation," he said.

PAC said the problems were aggravated by the failure of the Public Works Department (PWD) as the monitoring agency to recommend a halt to the project even though it had discovered weaknesses in the building construction.

The project, originally estimated to cost RM167 million, was awarded to Perangsang International Sdn Bhd (PISB) in 1994 and was supposed to be completed in 1997. It was finally completed in 2005.

The delays and repairs increased the cost to RM287.5 million.

The government is seeking to claim RM95 million in fines from PISB.