Malaysia's former ruling party Umno loses direct control of Utusan paper after shares sale to former party youth leader

Malaysia's former ruling Umno party has lost direct control of Utusan Melayu (Malaysia) after 31.6 per cent stake of the company's shares was bought by former Kulim-Bandar Baharu MP Abd Aziz Sheikh Fadzir on Feb 8, 2019.
Malaysia's former ruling Umno party has lost direct control of Utusan Melayu (Malaysia) after 31.6 per cent stake of the company's shares was bought by former Kulim-Bandar Baharu MP Abd Aziz Sheikh Fadzir on Feb 8, 2019.ST PHOTO: KEVIN LIM

PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - Malaysia's former ruling Umno party has lost direct control of Utusan Melayu (Malaysia) after 31.6 per cent stake of the company's shares changed hands on Friday (Feb 8).

It is understood that former Kulim-Bandar Baharu MP Abd Aziz Sheikh Fadzir was the buyer of the bloc of shares from Umno.

Following the sale, Umno's stake in Utusan would drop from 49.77 per cent to 18.17 per cent, ending the decades-long control of the Malay newspaper group by a political party.

Datuk Abd Aziz is a former Umno deputy Youth leader. However, he has been more active in the corporate world since 2005.

He is currently the executive chairman of Utusan. He was reappointed to the post early this month, following the expiry of his previous tenure in the group, which spanned six months from June 7, 2018, until Dec 13, 2018.

According to stock market data, a bloc of 35 million shares in Utusan crossed at a huge premium on Friday.

That block represented a 31.6 per cent stake in the company based on its paid-up capital of 110.73 million shares.

 

Data showed the bloc of shares was sold at 19 sen per unit (6.3 Singapore cents), which was 7.5 sen, or 65.2 per cent, higher than Utusan's last closing market price of 11.5 sen.

Utusan, which has been chalking up losses, was classified as a Practice Note 17 (PN17) company in August last year.

PN17 companies are referred to as financially-distressed entities which need to submit their proposals to Bursa Malaysia to restructure and revive themselves to maintain listing status.

The group has been going through a series of initiatives, including staff rationalisation and asset disposal, to restore its ailing financial position after the fall of the ruling coalition Barisan Nasional in last year's general election.

With Umno no longer part of the federal government, changes took place in Utusan's board.

This included the stepping down of Tan Sri Mohamad Fatmi Che Salleh as non-executive chairman and Datuk Seri Tengku Sariffuddin Tengku Ahmad and Jamalul Kiram Mohd Zakaria as independent non-executive directors in May last year.

Utusan had long-term and short-term debts of RM137.8 million, while cash stood at RM13 million as oat the end of September 2018.

Of its debts, the short-term obligation was RM54.3million.

However, Utusan has investment assets in its books of RM89.7million and also property, plant and equipment valued at RM196.3 million.

In recent months, Utusan had been vocal against former prime minister Najib Razak and some Umno leaders.

There had been an increasing call for the newspaper to be de-politicised and for it to remain as a voice of reason for the Malays.