Various sources cite mismanagement and questionable deals by the company’s leadership during its steady decline over the past decade.
Some of its ventures outside its core business including expensive helicopter acquisitions and a loss-making hydro dam project bled its profitable cable subsidiaries Universal Cable (M) Bhd and Leader Cable Industry Bhd. This eventually resulted in creditors petitioning to wind up these units.
The company had also been classified as a Practice Note 17 (PN17) company since September 2022 following a disclaimer of opinion on its financial statements by its external auditors, Ernst & Young PLT.
Since then, the company has been struggling to restructure its finances under court supervision, with little success.
After repeatedly missing deadlines to submit a regularisation plan to turn around the company’s finances, Sarawak Cable was delisted from Bursa Malaysia on July 15, 2025.
Controversial disposal
One of the board’s most controversial moves was the sale of Trenergy Infrastructure Sdn Bhd, a wholly owned subsidiary with a major Tenaga Nasional Bhd (TNB) project, for a song in 2023.
An infrastructure construction company, Trenergy was incorporated in 1996 but only began operations in 2002. Since then, it has completed 50 transmission line and infrastructure projects worth RM2 billion, according to its website.
A minority shareholder with a substantial stake in Sarawak Cable claimed that some directors may have breached their fiduciary duties by “engineering the undervalued sale of Trenergy” to Bilun Borneo Sdn Bhd, an obscure Sarawak-based company.
Via a share subscription agreement (SSA) signed in September 2023, the group agreed to dispose a 49% stake in Trenergy for RM1 million. The agreement also offered a conditional option to purchase the remaining 51% for a paltry RM400,000, provided a further RM600,000 in cash advances was made.
While the deal entitled Sarawak Cable to 80% of Trenergy’s project profits, the buyer allegedly failed to meet conditions and instead used a disputed RM13 million claim to offset intercompany debts.
A variation agreement in January 2024 released the buyer from its debt obligations, cutting the total purchase price to RM2 million. By September 2024, the board had transferred the remaining 51% of Trenergy to third parties for free, effectively giving away the subsidiary.
Sarawak Cable, under its court-appointed interim judicial management (IJM), is challenging the deal in court.
It is seeking the nullification and rescission of both the SSA and the variation agreement, the return of the Trenergy shares, general damages, and any other relief the court deems appropriate.
The group asserted in court filings the deal was structured to benefit “unknown third parties” at Sarawak Cable’s expense, effectively diverting a valuable asset for nominal payment.
In addition, the substantial minority shareholder was reported to be mulling legal proceedings against individuals alleged to have committed wrongdoings within Sarawak Cable.
White knight debacle
Another questionable move by the board was its ill-fated engagement with UK-based investment firm Serendib Capital Ltd and its principal Rafat Ali Rizvi, a wheeler-dealer with a chequered past.
With Sarawak Cable mired in debt, Serendib Capital came riding in as the “white knight” in December 2023, promising a RM250 million war chest to restructure and settle outstanding debts, and inject capital into the company to facilitate its future growth.
However, the relationship between the board and Serendip soon soured as Rafat never delivered the promised RM250 million capital.
In May 2024, the board finally came to its senses and terminated the white knight agreement with Serendip, and Rafat was ousted from its restructuring plan.
In retaliation, Serendib sued Sarawak Cable, its then chairman and largest shareholder Mahmud Abu Bekir Taib, and six other directors for over RM6 million, alleging breach of the white knight agreement.
The suit was ultimately struck out in mid-2025 after Serendip failed to fork out RM200,000 in security costs ordered by the high court.
Scrutiny and criticism
As a result of this “white knight fiasco”, the leadership has come under intense scrutiny and criticism for failing to safeguard the company’s interests and image.
A key minority shareholder said despite Rafat’s notoriety as a convicted fraudster, the board had welcomed him as a director and white knight investor, apparently without proper due diligence.
A British national, Rafat was sentenced in absentia to 15 years jail by the Central Jakarta District Court in 2010 for various counts of bank fraud that led to financial difficulties prior to the Bank Century bailout scandal.
Now renamed Bank Mutiara, Bank Century received a state bailout worth 6.7 trillion rupiah (then US$593 million) after its near collapse in 2008.
“The ease with which a known fraudster infiltrated the board indicates governance failures and desperation within the leadership during its financial crisis,” he added.
Sarawak Cable’s downfall is a sad saga involving powerful insiders and opportunists, both within and external. Beyond industry downturns and inept decision-making, critics say governance failures and possible fraud may have played a pivotal role in the company’s collapse.
For now, the focus has shifted to the courts to hopefully unwind dubious transactions, assign accountability to those at fault, and salvage what is left of a company that once had everything going for it.