Tuesday, June 16, 2009

How did UEM and Khazanah bosses rectify the Qatar problem in 2007?

Malaysian ‘warriors’ of the UEM Qatar project carrying the Malaysian flag into foreign land. Will it be another Malaysian story of the sacrifice, and dedication of staff let down by their bosses? Another story of determination and hope of the common people lost to the greedy corporate boys?

There was supposed to be a bonus announcement by UEM Group Chairman and former TNB Chairman, Tan Sri Dr Tajuddin Ali yesterday but it did not turned out such.

Little bird said the whole group of Board of Directors, presumably of UEM Builder, is in Australia on a brainstorming trip. If it so, best betul. Company is in a pressing situation and the Board members can make a trip to Australia. Maybe, the air in Australia is more refreshing for the brains to think than in Malaysia. Some winter golfing could revive tired minds too!

In an e-mail dated April 21st, 2009, Dr Tajuddin promised the same bonus as last year to the staff. Will that mean the promised bonus for the hardworking and dedicated staff of UEM is forfeited and diverted to some Airline and Hotel expenses for Board members and maybe family school holidays?

That’s just a naughty question that does not need answer. In the dated staff circular, Dr Tajuddin came off with a sombre tone and not as confident sounding as the press statement reported by Malaysia Insider, The Star and NST to dispell question by this blog.

It is believed that UEM had engage a management consultant to assess the financial situation of UEM. This blogger confided with some big gun in media and was advised to be vigilent in this exposè. The conclusion of that report will not be disclosed for now. The issue raised in this posting will be focused.

It will be focused on the question why UEM signed a joint and several agreement or arrangement in 2003 that resulted in the current lawsuit which claimed was directed towards the Consultant.

Subsequently, was it rectified when there was such opportunity?

Insufficient Study?

The effort by Superman8818 to established a blog here to explain the difficulty involved in undertaking the Qatar project was commendable.

This blogger consulted Engineers experienced in undertaking work abroad. They dismissed the stories as excuses for easily anticipated problems. Rising cost should be anticipated, added on or translated into Varioation Order. The peculiarity of Arabs business practise should have been understood earlier and not after Contract signed.

They went further to say that if that is the excuse, UEM was bordering on incompetence for not doing sufficient prior study and research of the site situation. A fundamental mistake!


This posting is revealing a proposed Supplementary Agreement that was supposedly to be executed in June 2007. Little bird claimed that the Qatar party agreed to sign the proposed agreement.

If it had been executed, it would helped to amend the condition in the earlier agreement. This supplementary agreement would have override whatever condition which is not favourable to UEM in the main contract. It is a condition precedent for any new works to continue and resolve outstanding issues like Variation Order (VO), Extension of Time (EOT) and Liquidated and Ascertained Damages (LAD). It would have relieved UEM of any futire claims.

This agreement was supposed to be signed prior to moving on to the 2nd phase of the Salwa Road project.


For recollection, let’s go to commentator Ciku Muda’s revealed information below:

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.
This tallies with the sequence of event in the Initiatory Pleading and proposed Supplementary Agreement, below:

Sequence of Events
28th April, 2001 – Agreement between Delo (later Parsons International) and Qatar PWA
20th July 2003 - Letter of Award to UEM
23rd October 2003 - Contract was executed
1st November 2003 - Commencement of the Contract
4th August 2005 - Extension of time letter to client (EOT1)
30th April 2006 - Completion of Contract (Phase 1)
December 2006 - Discovered signs of distress by Client
29th January 2007 - Client issued stop-work order
12th February 2007 - Extension of time letter 2 to client (EOT2)
March 2007 - Proposal to Client to resolve
21st April 2007 - Contractor submitted an offer to complete work
22nd April 2007 - Client accepted offer of 21st April, 2007
23rd April 2007 - Client issued new instruction and rescinded earlier instruction
June 2007 - Date of proposed Supplementary Agreement
What? Why? How?

The question now is: Was there such Supplementary Agreement? If there are such agreement, was the Qatari willing to sign? Is true to both the above, why did UEM decided not execute the Agreement? Would it not save UEM from the current legal situation?

What was agreed and signed instead?

Should we blame the Arabs or ourselves? Shouldn't we blame ourselves first all the time?

This blogger seek from UEM, and/or comentators Ciku Muda, and Putik Ciku Bergetah to explain this disturbing situation of a Company that used to claim itself as "The Nation Builder" and our nation’s construction flagcarrier.

During that period of time, Khazanah and EPU claimed to take a close control and monitoring of their investee companies, particularly in UEM. In fact, Tan Sri Azman Mokhtar, The Managing Dirtector of Khazanah is a member of the Board of Directors of UEM Group, and former UEM World. It shows he knows of the situation and showed keen interest in the development in UEM.

Why the silence from Khazanah? Is it true the rumours that Khazanah has “lepas tangan” on UEM? Is it true that members of the Boards of Director of UEM Group of Companies have practically "lepas tangan"?

Is it true that the Board is looking towards corporate restructuring their way out instead of telling the truth and getting heads chopped? Would that mean pouring away good profit to hide losses? Will that only serve to enrich the Investment Bankers but does not solve operational and organisational issues through genuine operational turnaround?

Seriously, Dato Seri Najib, Dato Husni Hanazlah and (whether we can continue to rely) Tan Sri Nor Mohamad Yakcop should start to wield their stick to start asking the hard questions on the state of the GLCs or as blogger Syed Akbar called them, Government Losing Concerns.

I put my trust Najib is willing to listen. He should not just listen to his officers but other sources of information to double check his Ministers, Pengarah EPU, and Khazanah and UEM officials.

Fat lady ain't over singing yet here.

* Edited 7:30 PM


Junah said...

"the whole group of Board of Directors, presumably of UEM Builder, is in Australia on a brainstorming trip"


You can't brainstorm if you have no brains.

Anonymous said...

Dear bro, minor comment... LAD stands for 'Liquidated and Ascertained Damages', and not as stated. It simply means that you have to pay some amount back to the other contractual party if you do not complete the works within the stipulated time.

Please carry on writing....

- Just Another Reader of Your Blog -

Anonymous said...

'A Voice' should be appointed as 'Minister of UEM' by Najib a.s.a.p....then UEM will be save !!

A Voice Boleh !!


Anonymous said...

Now, lets see what the good people in UEMG and UEMB is up to since the suit first surface couple of months ago. Bear in mind this a major conglomerate in Khazanah stable and has been without a boss since March 09.

1. The MD of Builder, has been calling meetings after meetings with his people, all locked in the room, trying to find a solution to this problem.

2. But, the way the meeting was going, its looks more like looking for excuses rather than solutions. He was leading a bunch of merry-men in suits chasing their own tails! It's a syok-syok sendiri meetings!

3. The contract team is led by one happy MD, his contract head who knows nothing about contract but acts like he knows the world, his lalang CFO and others that were hardly involved with the issues in Qatar.

4. NO Legal council to guide them. It's a classic case of ALL blind men leading one another.

5. They are still living in wonderland, banking on InsyaAllah & Muslim Brotherhood to save their asses. UEMB is still claiming that they are in very good terms with Bro. Hilal BUT they forget that it's SRPMT & Ashgal is the one that initiated the suit in the first place.

The BIGGEST mistake that UEMB ever did was ignoring their sponsors during the last two years. They forgot that Arabs, apart from money they also want face and that is what UEMB never give to them especially during Ridza's time as MD. And its too late now.

As far as this suit is concerned, its all about operational. But the MD is very good, and I mean, he's very very good, at story telling and creating perception. Both the Tan Sri Chairman and Datok Rahim Bakar kena goreng kaw kaw.

The MD is always claiming that he is a GOOD BUDDY of Tan Sri Azman Mokhtar. At one point, he claimed that he was the one that talked to AMO into giving an extension to Datok Ahmad Pardas's contract! Dahsyat tu blader!!

Rumours in the pasar malam says that Datok Ridza Abdoh is going to be the new MD of PLUS Berhad. Of course, AMO is in the know & approves of it.

Let's gamble a little bit here. I bet 2 sen, with Ridza taking over PLUS, it will be MINUS within 3 months!!

And finally to TAN SRI AZMAN MOKHTAR..Why are u abandoning UEMG at this point in time??? Come to think of it, you have abandoned UEMG long long time ago.

We, the RAKYAT, wants solutions..After all, it's OUR MONEY!!

Little Bird

Anonymous said...

Very nice again, bro. I have 3 reasons why khazanah or MOF have not taken action. 1, they are guilty 2, they are idiots 3, and worst, they are guilty and idiots. Man, i am so pissed. Lets expose more, people !!!

Donplaypuks® said...

There ws a time not so long ago when Plc's had 1 Chief Accountant and another Finance controller (FC).

THE Group FC would have all the numbers and Group financial position at his fingertips.

Nowadays, when they have the slightest problem, they engage an outside Financial and/or Management. Note PKFZ's consultants are claiming $147 in time cost fees and incentives.

So, what do the FC's at UEM, PKFZ , MAS, TM, Tenaga and others do nowadays? Plan 'brainstorming trips to nearby countries in this region like downunder, London, NY and Paris'?

Anonymous said...

Reading your series on UEM, your questions are relevant.

When Dohas was in desperation to be ready for the Asin Games, that was an oppurtune time to renegotiate the contract or sign this supplementary agreement.


In the early part of your series, you said that UEM didn't think that the Qatari would sue and Ciku Muda went on to blame Arabs for this and that.

Too late.

Itulah why terlalu tolak ansur Melayu.

Business is business. Why did nt they protect the interest of the Company ie Khazanah ie Government ie Rakyat? Why priority for sopan santun Melayu over sense of responsibiloity to your stakeholders?!!!!

For this, not only AHmad Pardas, but Tan Sri Tajuddin Ali and all the members of the Board should should resign en bloc and take responsibility.

High time heads get chopped for fumbling!

Anonymous said...

Well..a bunch of 9 merry men & the MD is in Vietnam witnessing a ground breaking ceremony which UEMG is only a sub-contractor.

These 9 men is of course the Saturday F#$%@ All (SFA) team which is also supposedly on a fact finding/meeting people/recce mission of Vietnam.

All first class VIP treatment all the way. The theme song I believe is "I dont like to sleep alone" by Lobo.

The question is wat on earth are we doing digging another hole in Vietnam? Builder's entry into Vietnam only as sub-con? Apa sudah jadi ni? Heloooo...this is the nation builder we talking about la...

Sudah buat kajian ke? Sudah study ke cara buat business di sana? Jangan jadi Qatar ke dua udah ler.

At least some people will "rindu" the friendly Vietnames wen they return home soon!!

In meanwhile, the current situation to them, hopefully, will blow away in the wind...

SFA Supporter

Anonymous said...


You are missing the main culprit. All the GLCs got into deep shit during the time of Nor Mohd Yakop when he was FM2 under Badawi and now Minister of EPU. Azman Mokhtar & gang were handpicked by Nor Yakop.

The Qatar and Arab connection is also due to Nor Yakop. FYI Nor Yakop's family members and sons also do business in Middle East now. They are contact point.

Anonymous said...

Don't just ask them to resign and get away scot free. Prosecute them and send the culprits to jail, wear uniforms instead of 3 piece suits and endless junkets for board meetings, golf and what not.

Do like what they do to Enron and the Jew who sqaundered 50 billion dollars Jewish money in the US. Sue them, make them pay back. For goodness sake, that was the rakyat's money they were playing with. They live very comfortably with fat salaries and all sorts of perks, jet setting and golfing when many of us suffer miserably like kucing kurap.

Send in the Police Anti-Commercial Crime (don't send in the clowns, as the song goes!). The Police have lawyers and accountants these days, let them confiscate the files, study them and bring to book the big "book-keepers", the top rung who acted detrimentally or omitted to act in the interest of the rakyat's company.

Those who have copies of the documents can submit them to the Police ACC Dept, anonymously if needed, so long as showing some evidence of document bona fide like letterheads and verifiable signatures. What about it Little Bird? The Police ACC don't have to wait for instructions to take action, do they?

Too many of this kind of nonsense going on and for far too long.

Anonymous said...

UEMG failed in Qatar, India (to date no toll collection yet for highway that completed more than a year now), In Indon....still struggling furthermore most of the people sent over there with very very good perks and always 'main wayang'and 'give Excuses'.

if Tan sri Taj...dare to take action on them via....'All senior management must resign'.

Anonymous said...

Voice / Birdies, dig deeper you'll find that UEM's overseas staff had been scamming the company. Materials purchased for their projects were sold off to outsiders / buyers. Loss is in hundreds of millions. Staff left / fired but not charged. All colluded in the scam and walked away with cool millions each. Just like that, all covered up and no one knows about it. Go expose this..

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