No discussions with China on repayment to Abu Dhabi state fund, says 1MDB

Signage for 1Malaysia Development Berhad (1MDB) is displayed at the site of the Tun Razak Exchange project in Kuala Lumpur.
Signage for 1Malaysia Development Berhad (1MDB) is displayed at the site of the Tun Razak Exchange project in Kuala Lumpur.PHOTO: BLOOMBERG

KUALA LUMPUR - 1Malaysia Development Berhad's (1MDB) chairman denied on Thursday that the Malaysian state investor is in talks with China to make repayments to Abu Dhabi's International Petroleum Investment Company (IPIC).

"I am the chairman of 1MDB, and as I know, there is no such thing as us talking to China about this," Tan Sri Dr Mohd Irwan Serigar Abdullah  told reporters in response to a Financial Times report that claimed 1MDB was enlisting China's help to settle a multi-billion-dollar dispute with IPIC. 

"Nobody has spoken to me about it."

Tan Sri Irwan, who is also the Finance Ministry's secretary-general, also said "no outcome" has been reached between the two companies after IPIC filed a lawsuit in June. 

"We are still waiting. Let us see what happens," he said at a separate press conference after the launch of a venture capital fund. 

He also said 1MDB would soon appoint an auditor, but refused to specify a timeline. 

The dispute between 1MDB and IPIC is part of a financial scandal engulfing Malaysian Prime Minister Najib Razak, who is increasing tilting towards China to help resolve the huge financial burden at 1MDB, which carried debts of more than US$12 billion at one point.

The spat arose from a bailout deal last year in which IPIC agreed to provide US$1 billion to 1MDB in an assets transfer deal. IPIC also assumed interest obligations on US$3.5 billion of the Malaysian fund’s debt. 

But the Emirati firm claimed in April that 1MDB had not repaid the US$1 billion advance and in June applied for arbitration in London, where it is publicly listed.

China has been approached as a source of funds for 1MDB, FT reported on Wednesday, citing three people with knowledge of the matter, one of whom said Malaysia would swap assets for financing.