Niggling question on PNB’s voting rightsTHE role of Permodalan Nasional Bhd (PNB) in the takeover of the four highways by the Finance Ministry (MoF) has come into question.
By virtue of being a substantial shareholder of MMC Corp Bhd, a question has arisen if PNB can vote in the shareholder meetings of GAMUDA BHD and Lingkaran Trans Kota Bhd (Litrak). This is because PNB with 18% in MMC that owns 50% of Smart Holdings Bhd, is considered a substantial shareholder of one of the companies.
Under the rules of good governance, substantial shareholders are not allowed to vote in corporate deals that are inter-conditional. However, there have been exceptions in the past.
Nevertheless this adds to the intrigue in the MoF’s move in June last year to buy out Gamuda’s substantial stakes in the Kesas Highway, Smart Tunnel, Sprint Highway and Litrak.
Gamuda owns 70% of Kesas Highway while the 30% is held by the Selangor government. Gamuda has a 44% in Litrak and 52% in Sprint.
As for PNB, apart from its interest in MMC, it has a 8.5% in Litrak and less than 5% in Gamuda.
The proposal are all inter-conditional, meaning that shareholders of all the companies have to approve the deals or it cannot be carried out. The companies have yet to call for their respective shareholders meeting.
However, it has been reported that Gamuda and PNB cannot vote due to their position as substantial shareholders in one or more of the companies and that the transactions are inter-conditional.
The major shareholders of Gamuda are the Employers Provident Fund (EPF) and Kumpulan Wang Amanah Pencen. The two funds collectively hold close to 20% while the rest are mainly held by funds, including PNB.As for Litrak, after Gamuda’s 44%, the next biggest shareholders are PNB with 8.5% and the EPF with 5.7%. The rest of the shares are held by funds, just like Gamuda.
Gamuda not being able to vote in Litrak is a given as it is a substantial shareholder in all the other companies.
Assuming PNB is not allowed to vote, whether the deal goes through or otherwise will depend on what the major shareholders want to offer the minorities with the proceeds of the proposed sale of the highway.
Striking a balance
PRIME Minister Tun Dr Mahathir Mohamad at the end of last year said the gig economy – which is pretty much made up of temporary, flexible jobs as opposed to full-time positions – is seen as a fresh source of economic growth.
These not only include jobs held by start-up entrepreneurs but also those held by the hundreds of thousands of Grab drivers and food delivery guys.
The Prime Minister said the government is deciding on laws to provide more regulation for such workers and also to give them more protection, especially when they are of retirement age.
Detractors say those who choose to work in the gig economy should not be accorded such privilege because they do not work “normal hours” and get more freedom and work-life balance in exchange for the lack of things like job security and retirement benefits which their full-time counterparts get.
This debate apparently rages on not only here but also overseas.
Another argument is that while jobs in the gig economy can be viewed as a new source of economic growth, this would come at the expense of what? Will traditional jobs be soon replaced?
Already, jobs in sectors seen as traditionally stable such as banking have been seeing cuts across the globe.
Last year itself, jobs in the global banking sector were slashed the most in at least four years, owing much to slowing economies.
That said, one cannot ignore data which show that the gig economy is growing.
In Malaysia, according to World Bank data, about 26% of the Malaysian workforce are freelancers and the number is growing, as more people choose to have flexible working hours.
One thing’s for sure: the gig economy is poised to become more important and will be made part of the 12th Malaysia Plan which is expected to be implemented next year.
It’s a matter of finding that balance.
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