KUALA LUMPUR: Tycoon Tan Sri Halim Saad claimed he had no choice but to abide by Tun Dr Mahathir Mohamad's directive to abandon his plan for the acquisition of United Engineers Malaysia (UEM) and disposed his shares in Renong Bhd two decades ago.
The 70-year-old businessman claimed he was not given any option or choice in his meetings with the then prime minister Dr Mahathir and former minister Tan Sri Nor Mohamed Yakcop between July 12 and July 17, 2001.
Halim said this in his affidavit-in-reply to his lawsuit relating to the takeover of UEM and Renong by the government.
He filed the suit at the High Court on Aug 2 by naming Dr Mahathir, Nor Mohamed and the government as defendants.
The defendants contended that Halim willingly disposed of his shares in Renong with compensation totaling RM165 million.
The defendants claimed that under the plaintiff's management, Renong Group's market capitalisation declined by 41 per cent from RM7.2 billion in 1997 to RM4.2 billion in 2000.
"At a material time, the entire Renong-UEM group of companies comprised a significant portion of the Kuala Lumpur Composite Index.
"Their weak performance has had a negative impact and burdened the overall stock market.
"To rectify the situation, Dr Mahathir agreed with Nor Mohamed's suggestions to restructure both Renong and UEM," claimed the defendants.
However, Halim argued that the government had not in any way paid any compensation to him.
"The plaintiff (Halim) denies that he voluntarily gave up his said property rights on the understanding that he would not receive fair compensation or that the sum of RM165 million paid to him was compensation for the said acquisition.
"The RM165 million received by the plaintiff from Khazanah was to compensate him for having paid RM100 million to UEM in connection with the Put Option which the government then requested UEM and Halim to let lapse.
"The payment also to compensate the plaintiff's losses due to the foreclosure of various assets pledged by him to various financiers for the purpose of financing the said RM100 million," he claimed.
Halim pointed out that the losses incurred by UEM and Renong during that period were due to the 1997 Asian Financial Crisis, political instability, and government's interference in economic matters.
"The Kuala Lumpur Stock Exchange was adversely affected at that time due to the 1997 Asian Financial Crisis and the monetary policies put in place by Dr Mahathir which had the effect of isolating the country, in particular from foreign investors.
"The political instability was caused by the arrest and subsequent prosecution of the then deputy prime minister and finance minister, Datuk Seri Anwar Ibrahim at the instigation of Dr Mahathir.
"The said incident and events preceding it, including the 1988 attack on the Judiciary, gave rise to an impression that the federal government was not concerned with the rule of law.
"It was also perceived that there was interference by the federal government in economic matters, with the deployment of government-controlled public funds being seen as a bail-out for some politically well-connected and influential persons," he claimed.
Halim claimed these matters made Malaysia unattractive to foreign investors, resulting in a sharp decline in foreign direct investments in the country.
The plaintiff is seeking a court declaration that the government was obliged to provide him with adequate compensation within the meaning of Article 13 of the Federal Constitution.
Halim also seeks compensation from the government as well as exemplary and aggravated damages.