January 12, 2010
Bina Darulaman Berhad: No Irregularities in Award of Contract
Bina Darulaman Berhad (BDB), a Kedah state government subsidiary, denied today alleged irregularities in the award of the contract to build the Insaniah University College (KUIN) campus in Kuala Ketil, Baling.
Its chairperson (Dato Paduka) Mohd Saad Endut said the decision by its subsidiary Kedah Sato 
Sdn Bhd (KSSB) to appoint a well-known Malaysian contractor, as the sub-contractor for the KUIN permanent campus project, was unanimous and fully endorsed by the respective boards.
He said all the processes involved in the award of this appointment were observed and the directors of BDB had acted in accordance with the code of corporate governance.
“The sub-contractor is reputable, competent and respectable with international experience and a proven track record in working with us to complete the KUIN.
“KSSB is excited by the opportunity to enhance its own industry expertise and future growth with this strategic partnership within Malaysia and abroad,” he said in a statement today.
On January 3, Kedah BN Youth had lodged a report with the Malaysian Anti-Corruption Commission (MACC) seeking a probe into alleged irregularities in the award of the contract to build the KUIN campus.
Kedah BN Youth chairperson Badrol Hisham Hashim claimed, the PAS-led Kedah government had awarded the contract for the second phase of the project, to a company which had not submitted a tender.
Badrol Hisham also claimed that six contractors who had submitted tenders for the project, were ignored by the state government, which awarded the contract to the company which has its headquarters in Kuala Lumpur.
The KUIN campus is now under construction in Kuala Ketil, at a cost of RM330 million and is expected to be completed in September next year.
Kedah Sato Sdn Bhd was awarded the contract for the first phase and the second phase of the project was to have been awarded through the tender system. Badrol Hisham also claimed that Mahfuz Omar (PAS Member of Parliament for Pokok Sena, Kedah) resigned as the chairperson of KSSB on December 29 last year in protest, owing to dissatisfaction over the allegedly unfair award of the contract.
Mohd Saad said the construction of KUIN is being undertaken on a private finance initiative (PFI) proposed by BDB and approved by the Kedah state government. “Therefore, the BDB Group as a public listed company on Bursa Malaysia, has a responsibility to its shareholders, bankers, its employees and the state government as its majority shareholder through the Kedah State Development Corporation (PKNK), to complete this project within the time period and approved budget.
“Our appointment of the said sub-contractor is one such decision where the question of risks has been debated at a number of risk committee meetings and special meetings of the board,” he explained.
Mohd Saad said given the need to complete the project on time, the board decided that the managament should select a suitably qualified sub-contractor to undertake the balance of the KUIN project.
The project must be completed by the end of 2012, to enable the university to move to its new campus and prepare for the student intake in May, 2013.
“The key consideration is the contractor’s track record and financial strength and on this criterion, the board acted professionally.
“All decisions made to date, are routed through our risk management committee before they are considered by the board, which has a right balance of independent directors,” he said.–BERNAMA
Click to access SKMBT_press%20release_bdb01.pdf
Din Merican: the Malaysian DJ Blogger 
Well, this attack on Bina Darulaman is politically motivated. This is because, I am told, there is tussle between Dato Mahfuz Omar, and the incumbent Menteri Besar Ustaz Azizan. The UMNO Youth leader merely took advantage of this to show that the Pakatan controlled and PAS led state government is incompetent and corrupt. That is far from the truth.
Bina Darulaman Berhad is run by a well disciplined team of professional managers led by an American educated MBA and accountant. It has a very competent board. It is a flagship company for Kedah and a model GLC in terms of governance. It should, therefore, be left alone to pursue its commercial objectives.
Sorry to go off topic.
But this is interesting:
http://www.croatiantimes.com/news/General_News/2011-01-10/16348/Croatia_gets_its_own_WikiLeaks
Hmmm … Croatia, formerly part of Communist “Yugoslavia”.
I am confused.
Who actually is awarded the contract??
—-Bina Darulman is NOT the contractor, is it?
— Is it KSSB? But then the article said, “the decision by its subsidiary Kedah Sato Sdn Bhd (KSSB) to appoint a well-known Malaysian contractor,
–The article said, “Kedah Sato Sdn Bhd was awarded the contract for the first phase and the second phase of the project was to have been awarded through the tender system…”
So who actually is the subcontractor or sub-sub contractor going to do the donkey job? Is this another Alibaba scheme or Ali-Ahmad scheme?
BADLY WRITTEN ARTICLE. Which idiot was asked to write this article for the media in the first place ?
One more interesting piece:
http://www.commondreams.org/view/2011/01/10-10
What about our local rabble-rousers e.g.
the pro-regime “news”paper, and the
former leader who refuses to fade away?
Can we sue them for incitement to violence?
Frank,
I agree that the standard of financial journalism in our country leaves much to be desired. It would have been better if BERNAMA had published the full press statement from the BDB Chairman.
Bina Darulaman Berhad (http://www.bdb.com.my) is a subsidiary of the Kedah State Development Corporation, which is listed on Bursa Malaysia. It is a diversified company involved in property development, construction and infrastructure, hotel and resorts, and quarry operations.
BDB is developing the KUIN campus in Kuala Ketil, Baling, Kedah under a Private Finance Initiative scheme. The project was approved by the State Government. Its construction arm is under its wholly owned subsidiary, Kedah Sato Sdn. Bhd which is also the project manager and contractor for the Zone 1 of the KUIN Project. PAS MP Dato Mahfuz Omar was previously Chairman of Kedah Sato.
I will not say more since I am an Independent Director of Bina Darulaman Berhad except to addy that BDB is a professionally managed and profitable company. There is nothing improper about its operations.
At its last meeting (January 9, 2011) in Alor Setar, the Board decided to issue a press statement to clear the air since some bloggers in Kedah and some politicians are playing up our decision to award Zone 2 and Zone 3 of the KUIN project to a well respected, financially strong and reputable Main Board company. This was a commercial decision since we are committed to complete and deliver the end of 2012.
Please visit the Bursa Malaysia website (indicated) for the full press statement from our Chairman, Dato Paduka Haji Mohd Saad bin Endut.–Din Merican
Din,
So, it goes like this:
BDB is given the contract to develop the KUIN campus
BDB’s Subsidiary, KSSB, is subcontracted by BDB manage the contract.
And KSSB again subcontract to “another contractor” to do the donkey.
Sounds like an UMNO type of contract. Reminds me of the contract fiasco in building the Shah Alam Hospital.
Each level skims a percentage of the money, and by the time the actual job is done, it costs a mountain to the taxpayers ( I presume they are taxpayers’ money).
How many sub sub sub contractors will be involved?? Imagine the skimming fee at each level is between 10-20 % of the contract. That will be millions of money for doing nothing except to sit in the boardroom and to employ a few clerks to shuffle papers in the office, while the hard donkey’s work is paid a smaller fee.
How are we to know again that the “professional subcontractor from KL who will further subcontract the whole job and then further subcontract, until the last contractor ends up buying cheap materials and employ poorly qualified workers to build the campus.
That is how we ended up with a leaking Parliament and a collapsed sports stadum.
Everybody passing the the job down while keeping the bucks for themselves. Typical NEP-type of contract for building infrastructures.
Looks like our PAS-run Kedah govt is taking a leaf out of the UMNO-BN govt style of getting things done expensively with mega projects to create instant millionnaires
Frank,
I have to rule you out of order on this. I am fully aware of what happened when the PFI deal was being formulated and its progress. It is a commercial deal which is mutually beneficial arrangement.
BTW, the KUIN project was a proposal by BDB to the state. We take the risks in exposure to the banks. We have confidence in the capacity of the state of Kedah to honour their obligations under this deal.
There are no instant millionaires here, and I resent your insinuation that there is hanky panky. This is what the UMNO fellas are suggesting. It will never happen when my colleagues and I are directors on the BDB Board. You have to careful in what you say on this subject. I suggest you should be more circumspect here. –Din Merican
Well Din, tell us the details.
On the surface, that is what is.
Question, why should KSSB subcontract the job. Why can’t it do it by itself, being a constructing arm.
Your intimidation sounds very familiar to me when the UMNO-BN gets criticised. Instead of defending the substance of the matter, they intimidate and try to impose sef-censorship on others.
Coming from you as a bloghost is a surprise and a disappointment.
Din
I am not questioning the integrity of BDB. Furthermore, never heard of it until now.
Whether DBD or KSSB are involved in the hanky panky business, that is for those in the know to spill the beans.
What I question is the contract process with so many layers taken to build the campus as reported in the media.
I have no sentimental views whether it is UMNO, PAS or DAP doing the job. I look at the facts of the case as presented here.
One can be defensive. But when one is being accused or being alleged is responded with a concealed intimidation, it may well mean (or not) there is something to hide. We learn that from the UMNO-BN side of politics, didn’t we?
Dear Frank,
This is a Pakatan controlled state led by a PAS MB. Over the last two years there is no reported corruption in the state. The MB has to be whiter than Caesar’s wife. We have the MACC watching every move the State Government makes. We have UMNO politicians like Badrulhisham waiting to pounce on everything the MB’s does. Dato Seri Azizan Razak also has his political rivals trying to undermine his authority.
I am afraid I am not at liberty to disclose details of what we discussed at the board level. We do, however, make announcements and disclosures from time to time with regard to our performance and other matters to the Stock Exchange and the Securities Commission. Let me assure you that we practice good corporate governance in BDB.
In all instances, we have acted prudently and in the best interest of our shareholders and other stakeholders. My board colleagues and I are fully conscious of our fiduciary responsibilities and the severe penalties that can be imposed on directors for violations of the Companies Act and other relevant statues. Thanks.— Din Merican
This is a Pakatan controlled state led by a PAS MB. Over the last two years there is no reported corruption in the state. The MB has to be whiter than Caesar’s wife….Let me assure you that we practice good corporate governance in BDB.- Din
That is good news.
However, Perception is more damaging than truth.
It is more important for Pakatan states to manage perception than to be self-assured and cocoon themselves their own integrity. That includes GLCs of Pakatan Govts.
Pakatan Govts should learn that people don’t know what are between your ears except through your behaviours, in words and in actions.
In this case, the behaviour speaks for themselves.
correction
However, Perception is more damaging than Untruths.
Din,
Looking at the list of courses being offered it looks like we are going to flood the Univerisity with single race again.
Is this the best that PAS can offer to Malaysians. Talibanisation?
Come on Din, please that Uztaz Azizan that we are listening and actions speak louder than words.
How to convince the non-muslins to vote PAS?
I will ask Tok Cik to set up a Kerbau University with Dr. Mongkut Bean as the Rector. I will volunteer to lecture on Ketum plantation and Tok Cik on Milking the Old Kerbau.
tean
I volunteer too to conduct BTN courses in praise of Talibanisation of Malaysia.
Ohh, there is a Tailban way of milking the kerbau.
I thought we have one too many universities and colleges already with half baked graduates taught by kangkung professors who write in bastardised Bahasa and speak in incomprehensible English.
These half baked students should have studied in Mandarin and they would have passed all the subjects for their degree. .
What’s sauce for the goose is sauce for the gander, so the saying goes. What’s is required out of BN is also required from the Opposition. We can’t treat the two differently.
BDB has to come out clean and be perceived to be “clean”. Nothing more and nothing less.
I’ll be going on my “rounds” in Zulkifli Nordin’s parliamentary constituency later this month and nothing irks me more then to learn of a glitzy Umnoputra-gate in Kedah.
tean, I prefer milking Sharizat not some old kerbaus…cheers.
What’s is required out of BN is also required from the Opposition. …BDB has to come out clean and be perceived to be “clean”. Nothing more and nothing less. – Tok Cik
Yessireee. Fully agreed!!!
Tok Cik, please kick Zulkifli Noordin’s ass for me in your rounds. He should be sent into the dustbin of history by next GE.
Yeah, Frank, that will be the major topic during my rounds.
Look guys!
Milking the proverbial cow is not the monopoly of Malaysians. We do milk cows here too. Heavy snow last night kept many cows in bed this morning.
If I may add, it is the culture of corruption that right thinking, fair Malaysians are up against. Corruption owes no loyalty to political affiliations.
Neither is it the monopoly of some.
Here is something about the politics of Kedah:
“Kedah Communications & Events (KCE) is a company formed and raped by the last UMNO Government of Kedah.
When PAS formed the Government in the State, it activated KCE, injected hundreds of thousands of ringgit with the aim of promoting the Pakatan Rakyat (PR) Government and the MB across the State .To do that PAS appointed 3 Pemuda PAS activists to lead the Company.
For three (3) years instead of backing the PR Government and the MB through media and events, the 3 PAS Youth guys mismanaged KCE, incurred huge losses and turned it insolvent.
Realizing this betrayal the MB refused to inject any more public funds into KCE and has now ordered the closure of KCE. The trio have now turned their guns against the MB.
They are pitting Mahfuz against MB. Mahfuz without thinking (can we expect Mahfuz to think ? ) fell into the trap. We shall wait and see what happens to the 3 Pemuda PAS traitors!”