In a statement, UJSB said the transfer will see TH transferring RM9.63 billion in assets to UJSB in exchange for two tranches of sukuk worth RM19.6 billion and RM300 million in cash. This amounts to a total of RM19.9 billion.
These assets are a mixture of listed equity holdings, properties, and one unlisted plantation asset.
The property assets transferred to UJSB include a 1.568 acre parcel of land at the Tun Razak Exchange (TRX) which was bought by TH for RM188.5 million (RM2,760 per sq ft).
It said this was “significantly higher” than the price paid by 1MDB of RM5.1 million (RM75 per sq ft).
“UJSB then purchased the TRX land from TH at RM400 million (RM5,856 per sq ft) which does not reflect the actual value of the said land,” it said.
“The purchase consideration was done at a significant premium (112.2%) to what PH paid in April 2015 (RM188.5 million).”
An evaluation of the land in March found that its market value stood only at RM205 million.
The 95% premium UJSB is paying for the land along with the other assets it acquired from TH is needed to ensure the successful rescue and restructuring of TH.
“The difference of RM10.3 billion between the consideration of RM19.9 billion and RM9.63 billion market value of assets is to be borne by the government to ensure that the financial health of TH is restored,” it said.
Should the value of the assets depreciate further, the losses for the government will be higher than RM10.3 billion.
“Overall, UJSB will bear significant losses as a result of impairment charges estimated at more than RM10 billion for the assets acquired by TH,” it said, adding that the TRX land transaction alone would result in an RM195 million impairment.
With the transfer of assets now completed, UJSB said it would continue with its mandate to rehabilitate and restructure the assets, maximise asset recovery value and redeem all monetary instruments issued by UJSB and subscribed to by TH in a timely manner.
Last December, TH announced its turnaround plan for 2019, including transferring RM19.9 billion in underperforming assets to an SPV under the finance ministry.