Malaysia s pension fund EPF under scrutiny over S 212m losses in MAHB privatisation deal

KUALA LUMPUR - Malaysia’s statutory pension fund has been questioned by lawmakers over “losses” of up to RM700 million (S$212 million) it allegedly incurred by selling 163 million shares in Malaysia Airports Holdings (MAHB) for as low as RM6.80 per share just months before buying them back for RM11 apiece in a privatisation deal.

On Feb 17, a parliamentary panel summoned top executives from the Employees Provident Fund (EPF),a substantial shareholder in MAHB, to explain the deal that would delist the state-controlled airport operator and bring in fresh investors including US investment fund BlackRock’s Global Infrastructure Partners.

EPF’s chief executive Ahmad Zulqarnain Onn attended the hearing. Also summoned to brief the Select Committee on Finance and Economy was EPF’s partner in the MAHB privatisation, the country’s sovereign wealth fund Khazanah Nasional.

Several sources in the know about the hearing told The Straits Times that the committee also grilled EPF on why it had slashed its MAHB stake from 15.6 per cent to 5.8 per cent between December 2022 and December 2023, before then raising its stake to 30 per cent as part of the consortium taking the Malaysian company private.

Critics say these sales, transacted at between RM6.80 and RM7.70 apiece, had resulted in “losses” ranging from RM500 million to RM700 million when EPF needed to repurchase the 163 million shares back at a higher price under the privatisation exercise.

EPF has held shares in MAHB, which runs 40 airports nationwide, since its listing in 1999.

It had never reduced its holdings as drastically as it did in 2023, shedding nearly 10 percentage points. Aside from this, in the two decades since 2005, it has never divested more than two percentage points in a year.

Finance Minister II Amir Hamzah Azizan, who was EPF’s CEO during the period when