GEORGE TOWN: There is no weakness or mistake in the sale of Penang Development Corporation-owned land in Byram, in the Seberang Prai Selatan district, to UMECH Land Sdn Bhd.
Chief Minister Chow Kon Yeow said the land sale procedure to the private company was in line with PDC's existing practice - either through open tender, Request For Proposal (RFP) or direct negotiation.
He said in UMECH's case, it was through direct negotiation, following a promotion exercise by PDC during the Dubai Expo 2020, where the company showed interest in doing business with the state government.
"The choice of UMECH was through a long and transparent process.
"However, the change in the equity structure in UMECH, which happened before the joint venture signing agreement was never relayed to PDC.
"As such, to prevent a recurrence of such an issue in future, PDC made immediate amendments on all the offer letters, by putting in a clause on the change in share ownership before the signing ceremony," he told the state legislative assembly sitting here today.
He said this in response to a question by Lee Khai Loon (PKR - Machang Bubuk) who had asked if there was a weakness or mistake in the whole process.
On Oct 17, the PDC decided to terminate a joint venture agreement with UMECH following calls to suspend the controversial sale of a plot of PDC-owned land in Byram.
PDC said the change in the majority of the equity structure of UMECH, to the extent that there is a change in the party controlling and leading the project that is implemented without notifying and obtaining PDC's official approval, was an issue that was taken seriously and could not be accepted by the PDC Board.
To a further question by Lee on the RM26psf for the said land, which resulted in dissatisfaction due to the low price, Chow said the price was determined based on various factors.
Various quarters had alleged that the current market price of the land in Byram was around RM80psf.
"The price was set and agreed upon by the PDC Board through due diligence.
"The price is determined based on the land cost, infrastructure cost, overhead cost and valuation by PDC-appointed valuer, among others," he added.
Elaborating, Chow said while reclamation was one of the main means to increase the state's land bank, PDC was also looking at other means.
"This includes land acquisition or collaboration with private land owners who want to develop their land for industrial purposes.
"We are constantly looking to increase our land bank and to develop more industrial parks," he said.
