Malaysia-Japan JV offers to take over NFC

Treasury Secretary-General Datuk Seri Dr Mohd Irwan Serigar said the company was chosen for its offer of a RM20 million capital injection to revive NFC as well as its offer to take over all of NFC's assets and liabilities.

He said the government feels it is important for the project to continue immediately as the country imports 76 per cent of its beef consumption.

According to a statement distributed to journalists, KASB is a joint venture between local firm Otoshitos Sdn Bhd and Japan's Hannan Food Group.

The NFC issue began to receive public attention after the 2010 Auditor-General's Report said NFC failed to meet the objectives of its establishment, while the opposition alleged misappropriation of the government's RM250 million soft loan to NFC, and the businessman alleged to have cheated NFC's former director is being tried in court.

Mohd Irwan said the letter of intent gives the signees six months to enter into more detailed negotiations.

The non-binding terms agreed to by KASB include taking over the assets and liabilities of NFCorp, the firm that runs NFC, including repaying the government a RM34 million loan taken in 2012 and 2013, he said.

Mohd Irwan said the balance of the RM250 million liability to be repaid will be decided in a new concession agreement to be discussed over the next six months.

Stressing that this is not a bail-out by the government, he said the company had made detailed studies before coming up with a new concession offer to revive NFC.

"They will pay RM34 million upfront, while the balance of RM216 million will be paid annually after a three-year grace period, plus interest.