Friday, September 12, 2014

Aircel-Maxis case: are the Malaysian authorities refusing to cooperate? ( 1 )( 2 )

Aircel-Maxis case: are the Malaysian authorities refusing to cooperate?

The CBI has chargesheeted former telecom minister Dayanidhi Maran for abusing his position to "constrict the business environment" forcing mobile operator Aircel to sell stake to Malaysian company Maxis in lieu for two sets of 'gratification' totaling rs 742 crore.

The chargesheet also figures the Maxis' owner T Ananda Krishnan besides Maran's brother and chairman of Sun Network Kalanithi Maran among others.

According to the chargesheet, the CBI is also looking into "the aspect of irregularity in grant of FIPB approval" in the stake sale. CBI said it was investigating the FIPB approval to Global Communication Services Holdings Ltd and the role of Indian partner, Sindya Securities and Investments Ltd, in holding 26% equity of Aircel.

Maran had approached the Supreme Court on Thursday saying CBI should be restrained from filing the chargesheet as the information from Malaysia was awaited and the investigation was incomplete. But CBI officials told ET that though Malaysia has refused to offer any information about the deal, the information received by the agency from UK and Mauritius was enough to file a chargesheet.

The above from an article in The Economic Times. Other articles about this matter can be found here, here and here, they contain the following sentences:

....the chargesheet would be based on evidence collected within the country as the Malaysian authorities were refusing to cooperate.

The CBI said it had completed the investigations without receiving a reply from Malaysia as responses from the UK and Mauritius helped them establish the charges.

The agency had told the apex court that overseas probe was being delayed due to the influence of the firm's owner in Malaysia who is "powerful politically".

The agency had also sought information from the Malaysian authorities through Letters Rogatory (LRs) but it did not get satisfactory response, after which the judicial requests were sent again. The reply to second LR is pending.

The Malaysian authorities should come forward and provide details regarding the above allegations of not cooperating. This case is already 8 years old and should be expedited, especially with two listed companies (Maxis and Astro) and several Malaysian persons being involved.

Tuesday, 2 September 2014

Aircel-Maxis case: are the Malaysian authorities refusing to cooperate? (2)

Astro Malaysia Holdings Berhad announced today:

"Astro Malaysia Holdings Berhad (“AMH”) refers to the media statement issued by Astro All Asia Networks Limited ("AAANL") that the Central Bureau of Investigation, India (“CBI”) has on 29 August 2014 filed a charge-sheet in relation to, among other things, AAANL's acquisition of shares in Sun Direct TV Private Limited in 2007. The media statement states that AAANL has learnt from media reports in India that the charge-sheet names AAANL, Mr. T. Ananda Krishnan and Mr. Augustus Ralph Marshall, amongst others.

Mr. T. Ananda Krishnan has a deemed substantial indirect interest in both AMH and AAANL while Mr. Augustus Ralph Marshall is a non-executive director of AMH as well as a director of AAANL.

We wish to clarify that AAANL is a separate and distinct legal entity and is not a member of the AMH Group of Companies.

This charge does not implicate, nor impact AMH, the entity listed on Bursa Malaysia Securities Berhad."

Maxis Berhad announced today:

"Maxis Berhad refers to the announcement made on 10 October 2011.

Maxis Berhad refers to the press release issued by Maxis Communications Berhad (MCB) today pertaining to media reports that the Central Bureau of Investigation, India has on 29 August 2014 filed a charge-sheet in relation to, among other things, MCB’S acquisition of Aircel Limited from Siva Ventures Limited in 2006. The charge-sheet names, amongst others, MCB, Mr. Augustus Ralph Marshall (a non-executive director of Maxis Berhad and MCB)  and Mr. T. Ananda Krishnan (who has a deemed substantial indirect interest in both Maxis and MCB).
This development does not implicate and will not have any impact on Maxis Berhad, the entity listed on Bursa Malaysia Securities Berhad."

That is of course good news for the current shareholders of Astro Malaysia Holdings Berhad and Maxis Berhad.

But the case is still highly relevant for Astro All Asia Networks Limited  and Maxis Communications Berhad, both their Board of Directors and their shareholders, during the above mentioned acquisitions in 2006 and 2007. And thus also for the Malaysian authorities.

Interestingly, both companies were subsequent to the alleged events delisted, Maxis Communications Berhad in July 2007, Astro All Asia Networks Limited  in June 2010.

And both were relisted again, but under a different name and in a different corporate structure: Maxis Berhad in November 2009 and Astro Malaysia Holdings Berhad in September 2012.

And both in such a way that "this charge does not implicate, nor impact" them, according to the above two announcements.

Was that one of the reasons behind the delisting and subsequent relisting (in a different structure) of both companies?

More information at The Malay Mail:

"Maxis denies wrongdoing in Indian telco scandal, scrambles for investment treaty shields"

Sunday, 31 August 2014

Millions of empty packets transported throughout China

After four years managing a private delivery company in the Chinese city of Ningbo, Chen Qian has acquired a new skill: he can tell which packets are fake even before he picks them up. Some are hollow boxes, some rattle with a piece of candy or a keychain. Recently, he says, merchants sending fake deliveries have started putting toilet paper rolls to give some heft.

Mr Chen says these account for about a quarter of the 4,000 packages his company handles every day. The phenomenon is widespread throughout China; a consequence of the country’s booming e-commerce industry and, specifically, a practice known as shuaxiaoliang, or literally – “sales brushing”. Online sellers are recruiting their friends, relatives and even professional fraudsters to make fake orders because shipping more goods would give them better placement – and therefore a better chance to garner more real sales – on websites such as Alibaba-owned Taobao.

“We’ve only started brushing recently,” said one Taobao shop owner in Hangzhou which sells hats and traditional silk scarves, who asked not to be identified. “There is no other choice for us. A lot of the other shops have been doing this for years, and we realised that no matter how well we did in sales, we could not compete with those who brushed.

A rather weird and wasteful practice, as described by the Financial Times.

Every system that allows itself to be gamed, will be gamed, if some people gain from that. Everyone would be better of if nobody would do this anymore, but how to coordinate this?

The above delivery company in Ningbo handles about 1.5 million packets of which about 400,000 are fake. But that is just one delivery company in one city, the total amount of empty packages per year must be huge, at least in the millions, probably more.