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Defence minister: LTAT not dependent on returns from Pharmaniaga

Publish date: Tue, 23 May 2023, 12:02 PM

KUALA LUMPUR, May 23 — The Armed Forces Fund Board (LTAT) is currently not dependent on the returns from the Boustead Group including its subsidiary, Pharmaniaga Berhad, Defence Minister Datuk Seri Mohamad Hasan said.

He said since 2019, the Boustead Group could only afford to return dividends to LTAT in the first quarter of 2023.

“LTAT has taken into account Boustead's inability to pay dividends in planning the annual dividend returns to contributors.

“LTAT has carried out asset rebalancing based on the Strategic Asset Allocation Framework to ensure sustainable annual dividend returns through other sources such as private equity, quoted equity, fixed income instruments and other investments,” Mohamad said in a Parliamentary written reply.

He was responding to Umno’s Titiwangsa MP Datuk Seri Johari Abdul Ghani who asked the defence minister to state the impact of the RM607 million losses incurred by Pharmaniaga to the LTAT which is a shareholder through Boustead Holdings Berhad and the ability of LTAT to pay dividends to contributors.

In relation to that, Mohamad said the decline in value and Pharmaniaga’s PN17 (Practice Note 17) status does not directly impact LTAT's ability to return dividends to contributors.

“In fact, LTAT's ability to provide a sustainable dividend return is expected to improve immediately following the implementation of Boustead's privatisation which can rationalise the company and also the implementation of the Pharmaniaga Regularisation Plan,” he said.

A company that is listed under the PN17 category is a listed company that does not have a core business or has failed to meet the minimum capital or equity and company shareholders’ funds.

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