1MDB: Rationalisation to reduce debts, ensure sustainability

1MDB in a statement released today said that it is focused on and making good progress with the implementation of the rationalisation plan as reflected by the number of initiatives that are currently underway.

"Tangible actions by 1MDB will significantly reduce debt and ensure the long-term sustainability of our three core assets, namely TRX, Bandar Malaysia and Edra Global Energy," the statement said.

It added that the company was also cooperating with authorities during their ongoing investigations.

The strategic development company commenced a review in January this year which identified the need to consolidate activities of the company as well as enhancing corporate governance and reduce debts by monetising assets.

One of the immediate outcomes of this review was the execution of a joint venture in March 2015.

The joint venture with Lend Lease of Australia was for it to develop 6.8 hectares out of 28 hectares of land in the Tun Razak Exchange (TRX).

Other than that, on June 8 this year, the government-owned entity completed the repayment of a US$975 million loan (about RM3.6 billion).

Besides that, 1MDB also entered a binding term sheet agreement with International Petroleum Investment Company that will result in a reduction of almost RM16 billion of 1MDB's debt.

On June 30 this year, 1MDB announced its intention to appoint an independent real estate consultant to help review interest received for the land parcels in Air Itam and Pulau Indah owned by the company.

As announced by the independent real estate consultant CH Williams Talhar and Wong, 1MDB received expressions of interest from over 40 local and international parties to be the development partners for the company's 194.4-hectare Bandar Malaysia project.