1MDB obtained the RM11 billion Phase 3B Independent Power Plant (IPP) project in early 2014 in a joint venture with Mitsui & Co Ltd and reportedly beat YTL Power International, TNB and Malakoff Corp in the open tender bid.
To bid for this project, money has been spent and once awarded additional money was used to prepare for financial close.
In order to develop this project, 1MDB energy will need to raise at least RM8b financing to achieve financial close.
Initially, the idea was to list the energy company first, and then use this separate listed company to raise this financing.
However, since the listing was delayed for over a year, in order to develop the project 1MDB must raise an additional RM8b at holding company level.
Under heavy criticism and negative publicity, a decision was that 1MDB cannot borrow anymore. Thus how do you expect 1MDB to develop this project?
Now, people are whacking TNB for buying into this IPP project to develop it.
When TNB gets this project, it is not as if they will lose money but will make long term money - which is why they bid on this project in the first place.
There are some people who does not like TNB winning this project even though it will make money and YTL is desperate for this project. YTL had complained bitterly about losing this project earlier.
Therefore, who do you want to take over the Phase 3B IPP project?
Foreigners? San Miguel? Ananda Krishnan? Syed Mokhtar? YTL? Genting? Vincent Tan?
Or do you want 1MDB to borrow an additional RM8b to develop this IPP?