Malaysia's MoF confirms 1MDB CEO booted as Bandar Malaysia chairman

Johari also rebuked allegation made by in a report published by Singapore Straits Times on 10 May, claiming two members from the Budiman Committee was relieved of their duties.

Picture for representation
Traffic passes a 1Malaysia Development Berhad (1MDB) billboard at the Tun Razak Exchange development in Kuala Lumpur Reuters

Malaysia's Second Finance Minister, Datuk Seri Johari Abdul Ghani, today confirmed the removal of Arul Kanda Kandasamy as the chairman of Bandar Malaysia. Johari also rebuked allegation made by a report published by Singapore Straits Times on 10 May, claiming two members from the Budiman Committee was relieved of their duties.

"I wish to clarify that the Committee was set up by the Cabinet sometimes in 2015 to oversee the rationalisation exercise taken by 1Malaysia Development Bhd to resolve its issues", the minister said in a statement.

He further elaborated that his affiliation to the Budiman Committee was following his appointment as the deputy finance minister in July 2015.

"The Budiman Committee continued the rationalisation of 1MDB and was able to dispose of 1MDB's power assets to China's CGN Group, reactivate the redevelopment of the Tun Razak Exchange which is in various stages of development," he said, according to a press release.

Johari added that the committee will pursue to conclude the international bidding exercise in respect of Bandar Malaysia and pursue the arbitration between Abu Dhabi's International Petroleum Investment Company (IPIC) and 1MDB to resolve the dispute over the US$3.5 billion payment made by 1MDB to the IPIC Group.

Johari added that there had been no meeting of the committee in the past six months, as all four assignments have been completed. "The Budiman Committee no longer had any functions to execute since then, therefore, any reports which state that any members of the Budiman Committee have been relieved of their duties are simply erroneous and maliciously misleading," said Johari.

The minister said the settlement agreement between 1MDB and IPIC and the current dispute between Bandar Malaysia Sdn Bhd and the consortium of China's China Railway Engineering Corp (CREC) and Malaysia's Iskandar Waterfront Holdings Sdn Bhd (IWH) are being handled directly by the prime minister's Office and the 1MDB board.

1MDB chief executive officer, Arul Kanda Kandasamy, declined to comment on his removal when contacted by International Business Times.

On May 3, TRX City in a statement said the share sale agreement (SSA) with IWH and CREC of the sale of 60% of the issued and paid-up capital of Bandar Malaysia had lapsed due to the failure of purchasing parties fulfilling payment obligations.

TRX City will retain 100% ownership of the site overseen by the full ownership of MoF while inviting expression of interest for the role of master developer of Bandar Malaysia.