BHB is a wholly-owned subsidiary of LTAT.
A source close to the matter told FMT that Nazim, who was appointed in June 2021, had drawn up key initiatives aimed at addressing LTAT’s RM3.5 billion debt and its dividend-trap structure.
“These initiatives were aimed at protecting LTAT from impairment, creating value for the fund and raising enough funds to meet its debt obligations for this year.
“They involved a delayering of Boustead Group and an overhaul of its governance and operating models,” the source said.
The source added that Nazim took the firm view that a complete revamp was necessary to address the financial challenges faced by both the company and LTAT.
“In fact, Nazim warned that unless the revamp was carried out swiftly, up to half of LTAT would be at risk of being exposed to Boustead without any oversight, and without LTAT being able to exercise any control,” the source said.
The source said the proposed revamp stalled in mid-December after newly appointed defence minister Khaled Nordin asked for the plan to be put on hold.
He said Nazim respected the minister’s prerogative but gave himself until Jan 30 to see if the plan would receive the go-ahead.
Nazim was concerned that any further delay would affect the execution of the plan and pose a significant risk to LTAT’s balance sheet, he added.
‘With no decision made on the proposed way forward for LTAT, Nazim felt that he could no longer fulfil the mandate of his job and tendered his resignation,” the source said.
In July 2023, LTAT launched Mampan25, a roadmap stretching from 2023 to 2025.
Officiated by then defence minister Mohamad Hasan, it focused on expanding the fund’s assets under management to RM15 billion, delivering consistent 5% returns to members, and recovering a RM3.3 billion investment in struggling Boustead-related businesses.
Among the key initiatives following Mampan25 was a proposed sale of 33% in Boustead Plantation Bhd to Kuala Lumpur Kepong Bhd. However, the deal fell through following a heated debate in Parliament, where concerns were raised about the potential loss of a Bumiputera-controlled company.
On Dec 18, 2023, The Edge reported that LTAT’s restructuring plan had been put on hold pending a review by Khaled, who took over the defence portfolio following a Cabinet reshuffle six days earlier.
Yesterday, LTAT announced Nazim’s resignation, saying he had been an integral part of the fund’s growth and success, and that his strategic vision and commitment had made it a more sustainable provident fund.