Thursday, June 11, 2009

'Big bird' vs 'little bird', UEM answered

This blog made a startling revelation of a potential loss in the tune of billion in Qatar for Khazanah-controlled, UEM on June 8th, few days back.

Today UEM have issued a statement via Malaysia Insider here.

Another Brick in the Wall wish to thank UEM for replying and taking seriously an issue raised by a pesky "housewife, and unemployed goblog and penembak curi" which they could shoo away as irrelevent.

This is truly commendable on the part of UEM in promoting corporate transparency. Minding the fact that the swift answer was made despite faced with a commotion on Tuesday, which this blog's wrongfully claimed as "tremor" at UEM office.

This blog was informed that a fire broke out on the 8th floor of their office during a meeting. Hopefully no life was affected.

The statement was issued this today, thus only the online news websites like Malaysia Insider could have reported. At this material time, none of the mainstream media have yet to report the statement from UEM.

UEM denied a coverup and gave assurance they will manage the case and believe they have a strong defense. They said, it is the consultant that is being sued and they are only a contractor and positioned as second defendent in the suit.

They went to the extend of denying allegation that Dato Izzaddin Idris is withdrawing from taking up the CEO job. That was not necessary for it was merely a naughty poke but understandbly in the corporate world, it was necessary.

However, UEM did not commented on the claimed sued amount. And, they refused to comment on information of frozen accounts situation and police arrest warrant, which they cited as speculation.

In the meanwhile, a commentator by the nic of Ciku Muda left a comment in this blog's comment box at around 3:20 AM here. The commentator gave the "story from the other side of the world" from their 'big bird.' If Ciku Muda is UEM's 'unofficial official side' of the story, they must be awake all night to prepare a response. Salutation to UEM.

There are still troubling issues but before commenting on their response, and perhaps 'little bird' would have one too, the MI report and Ciku Muda's comments is reproduced for the readers.

Another correction on this blog's part, it is little birds and not little bird. And, MI, don't simply bloody stereotype people, meaning this blog, as right wing socio-political website! *#(&^+$ ...

The MI report below:

UEM, Khazanah mum on Qatar troubles

By Lee Wei Lian, Malaysia Insider

KUALA LUMPUR, June 11 — A lawsuit to the tune of hundreds of millions of ringgit has been filed against UEM Group Bhd by the government of Qatar over a dispute regarding a highway project in the Middle Eastern country.

However, UEM and its parent company, the government-owned investment agency Khazanah Nasional Bhd, have decided not to comment publicly for the moment.

One Internet website alleges that there was an attempt to cover up UEM's legal problems in the Gulf state. The website also states that UEM's operations and bank accounts in Qatar have been frozen and that the Qatar government is going to issue a warrant of arrest for former UEM managing director Datuk Ridza Abdoh.

When contacted, a Khazanah spokesperson said that the company does not respond to "speculation".

UEM also declined to comment.

"UEM Group is not in the position to comment on the matter as we respect the Qatari legal system. We will not make any statements that may jeopardise our legal position," said UEM's director of group corporate relations and communications Basariah Abdul Latiff.

Group chairman Tan Sri Ahmad Tajuddin Ali however was reported yesterday as saying: "We are just the contractor. It is the consultant that has been sued but we are named as second defendant.

"We will manage the case. We have strong case to defend ourselves," when asked about the lawsuit after the company's annual general meeting.

According to the blog, which some consider a right-wing socio-political website, UEM and two other companies involved in the project in question, Parsons International Ltd and Qatar Insurance Company, are being sued for Qatari riyal (QR) 876,318,972 (about RM840,981,000) for failing to fulfil contractual obligations related to the construction of Salwa road in the Qatari capital of Doha.

The blog further claims that a further QR400 million is expected to be levied on UEM for the cost to complete the road the project which was started in 2001 and that the UEM Group and UEM World were delisted in order to cover up the potential financial losses.

Citing sources, the blog author also claims that Datuk Izzaddin Idris, the newly appointed CEO of UEM Group, may reconsider the job due to the "revelation" of the lawsuit.

Sources in Khazanah however contend that Izzaddin was aware of the issues in Qatar when he accepted the job and that UEM Group has not been listed in the first place.

According to news reports last year, UEM World was delisted and its property arm UEM Land was listed instead to give investors direct participation in the latter which has become the main driver of the share price of UEM World due to its projects in Iskandar Malaysia.

The Salwa road is one of the main shopping thoroughfares in Doha. The design was done by Parsons while construction was by UEM.
Ciku Muda's reply is as per below:

1. UEM was being victimized and bullied by the arabs! They failed to understand the culture of the arabs before venture into Middle East. Or it’s the Malaysian culture that always being nice to anybody. Arabs are well known for not keeping their words. ‘Insyaallah’ is being use as escape clause for anything. That’s why ME can never be in peace. Don’t blame the Zionist coz Fatah and Hamas themselves cannot live in peace. Kuwait was attacked by Iraq, Iran & Iraq war, blah..blah..blah.. Single currency agenda for the GCC country is also at threat as Oman & UAE walked out from the agreement when Saudi hijacked UAE’s earlier proposal to have the Monetary Agency headquarters in Abu Dhabi. And many others..

2. No any other contractor will survive when the country’s inflation rate skyrocketing to between 7% to 15% for the past 3 to 4 years. The situation in Qatar is not like Malaysia where most of the major construction materials are controlled items. More than 90% of construction materials are imported from all over the world. Steel, cement, bitumen, timber, plywood, paint, and many more. They cannot even produce the aggregate/stone which is essential for producing concrete and asphalt mix! Worst deal, supplies are being monopolized by only few family cartels. Price of raw materials can be doubled if not tripled, within few years if not months. And UEM are being forced to absorb all the additional cost!

3. UEM started the project with many problems, be it internally or externally. The biggest problem was difficulty to get a consistent supply of good quality aggregates/stone for asphalt mix production. The dedicated quarry for the project and even in the whole Qatar, the land are generally formed with young limestone which is very soft and brittle. The project was further hit with decision by the Qatar Government to close all the quarries due to the environmental reasons! UEM got a highway project and now the government is closing all the quarries? What a nonsense! Starting from then, the project was highly depending on the importation of the stones from UAE. The project was further hampered with logistic problems when the tiny seaport congested with so many ships and long queues waiting to berth. Trucks and trailer queuing at the yard and charges was increased due to low productivity in doing business. Can you imagine how much time and cost had badly impacted the project?

4. The design of the project was being carried out by a ‘well reputable’ consultant in the world. The American consultant who was earlier screwed up in Iraq’s development projects was being praised as the best designer in the region. And yet, providing a flawed design for international contractors to tender. And when the project had delayed and failure occurred, ‘twice’, and headed the front page of prime newspapers, Public Works Authority was under tremendous pressure. Even with their internal expert’s Investigation Committee had clearly pointed out that it was due to the design flaws which was not complying to Qatar Standards and Specification, UEM was being dragged into the proceedings. Charging them at fault for not ‘discovering’ the design fault by the consultant and not complying to requirements which were not in the specification? PWA is really trying their luck..

5. The WSN study is a detail survey, testing and analysis of existing road condition using specific testing equipment which will be factored in for designing the structural of a highway. An ordinary contractor will not be able to carry out the study if not by appointing a design consultant. (Any Professor, please correct me if I’m wrong). What more if the contract itself does not ‘allow’ contractors to carry out the study when no instruction, information, data, assumptions, design criteria and factors were being issued to contractors for tendering.

6. The failure took place exactly during the prestigious event of Asian Games 2006 (which Malaysia had lost the bid to be the host). Some portion of the highway starts to crack and damage severely. Unusual heavy rain since the past 10 years had deteriorated the damage further. However, it was surprisingly that the failure took place at only one particular type of design which is the pavement ‘Type 5’ out of 7 or 8 different types of road design in the project.

7. Subsequent to the first failure, at half way through the project, UEM was invited by PWA to re-negotiate the contract which ended up UEM being given a new price, new completion date, new design drawings, new requirement & specifications (which was until to date not approved by Qatar General Organization For Standards and Metrology) and less scope (as PWA wish to involve local company participation in the project). Both parties mutually agreed with a further terms in which PWA promised to assess fairly UEM’s earlier submission of financial claim, compensated losses incurred by UEM, no back charging of cost incurred by local companies participation, and many sweet promises more.

8. The ‘2nd phase’ of the project then begin, however with many signs of trouble starts to appear. Asphalt mix design was not being able to attain approval from QGOSM as the new specification again, does not complying to Qatar Standards and Specification and it ended with PWA giving their sole approval. The concern of a high risk for another failure was strongly raised by UEM to the consultant & PWA but UEM’s advice was neglected. Ended up with the 2nd round of disaster.

9. During the ‘2nd phase’ of the project, 10 other local contractors were involved. All other road/asphalt paving contractors facing the same mode of failure which resulted from the introduction of the new unproven specification. And yet, all the contractors including UEM were being blamed for the failure due to incompetency and lack of quality control in the construction! A massive scale of redo and rectification works which involved millions of money were carried out and at the end, all the contractors were not being paid for it. What a world..

10. Even with so many contractors involved in the project, the completion date cannot be achieved. Towards the end of the project, UEM was given few additional works and instructions to take over some of the other contractors’ scope significantly in order to expedite the completion of the project.

11. During the project life, PWA’s Project Manager has been removed for a minimum of 4 times! Subsequent to the 1st failure and at the beginning of ‘2nd phase’, PWA’s project management team was being removed and replaced with a ‘reputable’ management team which had earlier successfully completed Qatar National Sports Complex for Asian Games 2006. However, the inexperience team (in roads construction) was misled by their internal inexperience consultant from Australia which lead to another disaster and triggered public attention nationwide. Further to the 2nd failure and delays, PWA top guy was removed! The new MD was appointed somewhere in early 2009, after the project was at last being completed. Then, this was the time when the summon was issued to all parties involved in the project (contractor, consultant & insurance company). So, you can see the political agenda and the ‘true colors’ of the arabs! This is the way they are doing bussiness!!

12. What a pity to the arabs who is actually being con by the American and Australian consultants. They were also being mislead by the so called ‘expert’ from UK regarding the investigation of the failure. They had never learn their lessons. Making silly mistake twice and wasted millions of government’s money. In their case, not the tax payer’s money as they are a free tax country. It is the oil money/gas money. That’s why they don’t have to answer to the public, except for some inconvenient to the road user and edgy eye catching.

13. Projects being delayed, contractors at lost, public is suffering and PWA are definitely can’t sleep well. All the well reputable giant contractors from all over the world are suffering in all mega infrastructure projects handled by PWA. The Croatian, Germans, Turkish, Malaysians are all suffering. All their projects had been badly delayed. The whole country is in a mess and being screwed up by PWA. And they are really stupid enough to solve all the problems and just passed it to the court to decide.. (Maybe the rich is getting poorer due to the global economic crisis) Hope that this phenomenon won’t chase investors out of the country. As for the new investors, you better think minimum, twice..
Thanks Z ... Ciku Muda.






Anonymous said...

This why majority of the glc's have been raped,plundered and the beauty of it all this phrase come's to mind,depa buat silap bukan salah.And wala the monkey that screwed the whole project is appointed to another glc to fcuk it as well,only in Malaysia that script works.

Anonymous said...


Item number 7 of Big Bird's questionable!

This one can give wing to big bird to fly away.

Legal Eagle said...

A Voice

Whether first or second defendent, the liability is still there.

Is there an agreement between UEM and Parsson to clearly defined the financial liabilities?

If Parsson default, we are screwed big time!!!!


Anonymous said...

bravo to A Voice for highlighting the comments made by Ciku Muda...I salute you for being reasonable and fair.. publishing 2 side of stories for the people to read is at the least a blogger can do to show their fairness...not motivate by personal agenda or else..

Cheers bro!


Anonymous said...

A Voice,

No matter what, I'm proud to be Malaysian and as part of the Team in Qatar. Thanks to the tough guys behind the scene i.e. PemudaBerderai, Enrico Lambardi, prince_erie, & etc for their extraneous effort to explain the truth.

At least, I'm pretty sure that I could sleep tight tonight as tomorrow is Friday... cuti!!!

"UE3 jer"

Anonymous said...


Universiti Teknologi MARA should set up School of Arab and Semitic Anthropology. So that our merchants and diplomats have referral centre on Arabs and Semitic psychology, culture, behaviour. At this moment the only referral sources that our merchants and diplomats has on Arabs and Semitics (from Malaysian perspectives) is from the evergreen P Ramlee's movie Ali Baba Bujang Lapok.

Prof Awe Kecik

Anonymous said...

UEM = katak dibawah Tempurung

How many international projects have UEM undertaking before ?? Most Arabs are more 'Global' than most of Malaysian (jaguh kampung) !!

Serve you right...UEM !! now no more UMNO 'Ketuanan Melayu' protection..let see how you going to deal with the Qatari !!


Anonymous said...

We wish UEMB well & best of luck in their contractual battle with the Qatari Government.

We hope they are equipped with proper documentations & experienced personnel to take on this fight.

We also hope the MD does not appoints the Nepalese Tea-Boy to lead the battle with the MD's 5'0" General in support.


Anonymous said...

...Qatar government is going to issue a warrant of arrest for former UEM managing director Datuk Ridza Abdoh.

When contacted, a Khazanah spokesperson said that the company does not respond to "speculation".

Sabtu lepas knp agaknya Rahim Bakar yg attd function & bukan MD, Datok Ridza Abdoh?

Sebab..dia akan ditangkap di immigresen!!

Speculation ke idak, suruh la Ridza selesaikan kes ni, maila jumpa org Qatar ni...

Jgn la dok MERCU jer pas tu suruh org lain cuci mangkuk hang!

Amacam...ada berani ka??

GLC = Gula2, kasi Lingkup, Chao!

Anonymous said...

Tuan Haji..@ Ciku Muda

Your point no 7 tu ana ada mushkil sikit la..


Tolong jawab..


Anonymous said...

Here have something you don't know!

Anonymous said...

Look in to this please!!

Anonymous said...

Hi. I'm not a Malaysian ,but i have driven through the Salwa International Highway in Qatar before. I think it is quite a wonderful project, despite certain design errors and re-works that needed to be done. Politics and chronisms aside, I guess it was a brave (but an expensive) effort. About the item no. 7 by the Big Bird, I have read somewhere that the Qatari had issued a Work Order to UEM on that matter, highlighting the new terms and conditions.
Overall, there are good points from both side of the wall. Some info for the readers, the GLC model has been applied rather successfully in some countries. All the best to Malaysia.

Anonymous said...

Legal Eagle, you are not me. Stop misleading people.

Anonymous said...

Despite challenges, we complete…
In the name of Allah, the most gracious and the most merciful.
I have always looked forward to a posting to overseas. In me, I’ve always wanted to experience new people and cultures. Prior to my posting, in my research and briefings received on Qatar, although I find the country’s initial outlook as a country keen on proving itself on the world stage, my first impression when I set foot into this country is that it was not just about proving itself but its passion.
Qatar, in itself is a very unique country, while small in terms of size and population, the buzz and its vibrant nature fascinates me. Being one of the richest countries in the world per capita, if not the richest, the opportunities and the challenges that arise drive people. A host of multinationals are all here to explore and to compete. Therefore, UEM should be proud that it had made inroad to this wonderful place.
UEM has redeemed itself through its perseverance in completing 2 projects and it stands proud here in Qatar. What it has achieved in the last 5 years is astounding and makes it a model of the ‘Malaysia Boleh’ spirit.
International companies and their people are in no way special. In my opinion, they all adopt the same ingredients, which they are able to excel at.
It starts with the right leadership — visionary to continually set challenging objectives to drive the company forward, commercially astute to make the right business decisions, willing to take calculated risks, courageous to continually undertake difficult transformations to cope with the changing environment, and motivational to bring out the best in their people to achieve stretched goals. Of equal importance is adopting and inculcating the right set of values and principles into the culture of the company so that it would always operate with high integrity, ethics and professionalism.
I have always wished that Malaysian companies could grow into successful global companies.
I have followed the progress of Malaysian companies with interest and I am always delighted to read of their successes, especially when they expand beyond the boundaries of Malaysia on their way to achieve international status.
There are now many Malaysian companies with the necessary ingredients for international success but one particular company stands out. I have had the good fortune to work with UEM here in Qatar and I am delighted to have the chance to contribute my expertise.
Every Malaysian knows of UEM, but what you may not know is that every one in the construction fraternity internationally knows and, more importantly, thinks very highly of UEM.

Anonymous said...

Despite challenges, we complete… (cont’d)
What UEM has achieved in Malaysia over the years is astounding. It must have been daunting from the small group of companies, with limited experience, to have been given the onerous task of managing the country’s mega projects, developing a diversify businesses and facing the multinationals that have operated in Malaysia for decades.
For sure, we all had to be courageous and visionary, qualities that have been perpetuated in the UEM leadership since then.
Equally daunting was the decision to venture overseas, to countries with environments that even multinationals find very difficult.
Recognising that Malaysia’s construction sector is relatively small, UEM knew that to continue to exist and grow, it had to take its operations overseas.
As far as I know, UEM also operates in several countries overseas, including Indonesia, Singapore, Papua New Guinea, Vietnam, Kingdom of Saudi Arabia, Qatar and UAE. It has a large presence in India and is set to expand further.
UEM has helped to develop a very proficient local construction industry capable of operating around the world.
Standards are high, competition for limited projects in the current global economy uncertainty is intense and only the best companies can survive.
UEM has not only survived but also thrived in the face of these challenges, so one can understand the pride that the UEM’s employees feel.
This is not to say that UEM cannot improve further, but I do admire their passion for success.
I personally have worked closely with senior UEM management, especially here in Qatar. I know many of them would be desired by international companies but I also know that it would be hard to entice them away because of their dedication and commitment to the company.
I understand the UEM have had to face many challenges in its endeavours, for example completing the prestigious Salwa International Highway Project, but had managed to come out good. While I am impressed with UEM, from my experience here, the business environment is both tough and conducive at the same time.
I am a Malaysian and so I am proud of the success of one of our Malaysian companies.
I am also moved to share what I know of the company because I fear that my fellow Malaysians are unaware of quite the success UEM is.

Anonymous said...

Despite challenges, we complete… (cont’d)
“Malaysia Boleh” is perhaps an overused, much mocked phrase, but the spirit is real, and it is demonstrated by UEM. UEM came, promised and finally delivered.
I also believe UEM will have gained enough experience in overseas business ventures and its past involvement should be the right stepping stone to a greater height if not in Qatar but all other places it wishes to venture.
I think it is time that we recognise our worth and our ability, and give Malaysian companies the credit they deserve.
“Putik Ciku Bergetah”

A Voice said...

I will always give space to anyone responding to my postings, as long it is done courteously without bad language.

This discussion in the commentary could be made great if we stick to strictly facts and sound arguments. If possible put aside emotion, insults, and snide remarks, then we can be thorough on the issue.

Warnings like asking to stop misleading people with furnishing fact, reasons and analysis does not add any value to the issue on hand.

Nor does rambling at length trying to use sentiment rather than address the real issue of concern serve to dismiss the perception against UEM Group.

The issue is why the delisting? Is it to coverup a problem???

Anonymous said...

A Voice you said:

"The issue is why the delisting? Is it to coverup a problem???"

Is it the delisting of UEM World you're talking about? have you read the announcement from UEM about the delisting? if you dont I believe you should read then..$File/Press%20Release%20-%20UEMW%20Delisting%20(31Oct08).pdf

the delisting was announce to Bursa and also appears in press can google it

and I would like to refer back to your comments on previous article "Is the delisting of UEM Group to coverup a major loss?" were saying:

1. "Critics are saying why take the CFO of TNB, a losing concern. A good answer for simple deflection would be that the TNB CEO won the CEO of the year award."

For your info he didn't win..was a runner-up actually

2. "Why not an Enginner since UEM is involved in many construction job abroad and locally?"

UEM is not all about construction..they got PLUS, Pharmaniaga, CIMA, UEM Environment and few others...It's an investment holding company....UEM Builders obviously the construction company..I believe you can see the difference..



Anonymous said...


I think you are being quite short sighted. UEM may be an investment holding company but its subsidiaries are all involved in the engineering sector.

CIMA - make cement, need engineer
PLUS - run roads, need engineer
PROPEL - well I think you get my idea by now.


Anonymous said...

To Anon 11.58,

I'm referring to what A Voice said..he literally said construction not engineering...pls read properly.....


Anonymous said...

To Anon 11.57,

by having engineer does not mean that the company is an engineering company...even Pos Malaysia have their own engineer will that make them an engineering company too?

dude, just go to their website and see...I mean UEM Group is not only about construction...cheez..

and as for CIMA i prefer calling them as a manufacturing company instead of engineering company!

cheers dude..


Anonymous said...

UEM bullied & victimised by the Arabs..?? C'mon la brader. We are talking about UNITED ENGINEERS MALAYSIA BERHAD la. Not some Cap Ayam company. shallow one no wonder kaput!!

Let's see how a Malaysian GLC stacks up against other Class A Contractors in the GCC:

1. WCT : Bahrain F1 track - They make money & finish ahead of schedule.

2. IJM : Completed Emirates world largest catering complex

3. IJM/SUNWAY/ZELAN Jv : Completed 1.24B Rheem Island in Abu Dhabi

4. IJM - Fortune Tower

and the list goes on...

Admit it la..u guys are there like chicken with a head!! No body gives a damn about wats going on there. Neither ur HQ nor ur Khazanah shareholders couldn't care less pun.

Wats important for ur bosses is to travel overseas on first class, stay at 5-star hotel for weeks and...watching QATAR OPEN GOLF, live!!! Dat sounds about right isn't it?!

SO..Whom got bullied here? U got bullied by ur own follies, as simple as dat. On the other hand, WE, THE MALAYSIAN TAXPAYERS is the REAL VICTIM here.

SO, stop whining!!!

P/S: If UEMG think they cant survive the ME, WHY ON EARTH ARE U TAKING UP PROJECTS IN SAUDI??? It's because there's money to be made la, only IF it was executed properly.

Liang Xi

Anonymous said...

The PWA (ASHGHAL)Magazine mentioned that:
"The committee report has clearly pointed out the faults and problems in the design of the project. The consultant has designed the project based on measurements beyond the standards and specifications of Qatar. Due to the transparency and truthfulness of Ashghal, public opinion on the issue emerged through newspaper columns and media responses."

Interesting why they sue UEM ?

Anonymous said...

Discussão palpitante neste espaço, tópicos como aqui vemos demonstram valor aos que analisar neste espaço :/
Faz muito mais de este espaço, a todos os teus cybernautas.

Anonymous said...

UEM bullied & victimised by the Arabs..?? C'mon la brader. We are talking about UNITED ENGINEERS MALAYSIA BERHAD la. Not some Cap Ayam company. shallow one no wonder kaput!!

Let's see how a Malaysian GLC stacks up against other Class A Contractors in the GCC:

1. WCT : Bahrain F1 track - They make money & finish ahead of schedule.

2. IJM : Completed Emirates world largest catering complex

3. IJM/SUNWAY/ZELAN Jv : Completed 1.24B Rheem Island in Abu Dhabi

4. IJM - Fortune Tower


Maybe Half truth at best!

I work in UAE and I personally work on the #3 project above not directly under IJM/Sunway/Zheelan but as external consultant.

I acknowledge that the project has been completed but not without severe loss to IJM/Sunway/Zheelan!

There multitude of problem with the their work...We personally inspected their(IJM/Sunway/Zeelan) work and there are many flaws which they have to redo!

I was informed by their workers that by the end of the project they had not been paid for months.

Let me tell you something...bully and victimised by Arab is real.

Not just UEM...there are many more companies being "victimised" ...even the big Aussie/British like Leighton...

My Say