KUALA LUMPUR: The joint venture (JV) between 1Malaysia Development Bhd (1MDB) and Aabar Investment PJS in 2013 fell through despite the issuance of US$3bil in bonds, the High Court here heard.
Key witness Datuk Shahrol Azral Ibrahim Halmi (pic) testified at the 1MDB trial of former prime minister Datuk Seri Najib Abdul Razak that a special purpose vehicle (SPV) company called Admic was set up for the JV between 1MDB and Aabar.
The former 1MDB CEO said this during the examination-in-chief by lead prosecutor Datuk Seri Gopal Sri Ram on Tuesday, adding that Admic was precipitated by fugitive financier Low Taek Jho.
He said that Low - better known as Jho Low - intended for the SPV to be used in what was known as “Project Catalyse”.
The JV - purportedly for investments in the property sector in Abu Dhabi and the Tun Razak Exchange - was signed in a ceremony attended by Najib and the Crown Prince of the United Arab Emirates on March 12,2013.
The funds were fixed at US$6bil by way of a 50:50 JV whereby 1MDB would have to inject half of the JV value at US$3bil.
“But after the US$3bil bonds were issued by 1MDB’s Global Investment Ltd (1MDB-GIL), there was no business by Admic nor was there any capital injection into the SPV company as per the original plan.
“Admic was actually inactive and not executed as planned, ” Shahrol said.
He said the JV was outlined in an action plan sent by Low to him through confidential emails, adding that 1MDB lawyer Jasmine Loo managed the establishment of Admic as per Low’s instructions.
“It was indeed planned by Low but without the support from the then-Finance Minister who was Najib, a letter of support (LOS) would not have been issued and subsequently, the issuance of bonds would not have been obtained, ” he added.
On Monday, the court heard that Najib had “bulldozed” his way to get a ministerial letter to support the issuance of US$3bil in bonds in relation to the JV between 1MDB and Aabar.
The LOS was issued just two days after 1MDB and Aabar inked their deal on March 12,2013.
Najib, 66, faces 25 charges in total - four for abuse of power that allegedly brought him financial benefit to the tune of RM2.3bil and 21 for money laundering involving the same amount of money.
He faces imprisonment of up to 20 years and a fine of up to five times the sum or value of the gratification or RM10,000, whichever is higher, if found guilty.
The trial continues before High Court judge Justice Collin Lawrence Sequerah next Monday.