Tuesday, 8 June 2010

Sticking A Finger In The Wind...


Finance Ministry denies giving betting licence to Ascot

KUALA LUMPUR, June 7 — The Finance Ministry today denied awarding a sports betting licence to tycoon Tan Sri Vincent Tan's Ascot Sports Sdn Bhd despite earlier reports that the company will accept wagers for next season's English Premier League.

In a written reply in Parliament by Finance Minister Datuk Seri Najib Razak, who is also Prime Minister, to questions from four MPs, the ministry said the government has not yet concluded its discussions and terms regarding the legalisation of sports betting.

“The government has yet to issue a licence to Ascot Sports Sdn Bhd for bookie operations in Malaysia.

“The government has also not concluded discussions on the terms and conditions for licensing to Ascot Sports for bookie operations in Malaysia,” the statement said.

The ministry also said it was still open to feedback from various parties.

PKR Batu MP PKR Chua Tian Chang asked if it was the government or Tan (picture) who has been misleading the public.

“This reply is very shocking because for the past one week, Vincent speaks as if he has the licence. So who is misleading the public?” he told reporters during a press conference in Parliament.

In a bid to quell a growing uproar over the sports betting licence, Tan said over the weekend that he will donate the entire RM525 million from the sale of the stake to charity.

The money is proceeds from the 70 per cent stake in Ascot Sports that is being sold to his listed Berjaya Corp Berhad.

However, Pakatan Rakyat (PR) leaders have scoffed at Tan’s gesture to donate the RM525 million profit from selling part of his sports betting company and justification for legalising that business.

Berjaya Corp reported that the government had last month re-issued the licence to Tan after the original licence was cancelled by the previous Abdullah administration. The tycoon’s son — Datuk Robin Tan Yeong Ching — will retain his 30 per cent stake in the company.

Vincent Tan had first obtained the licence in 1987 but had “asked the government to take it back” when the venture was unsuccessful. But he has now obtained the right to get the licence back and was exercising it.

Berjaya Corp, a gaming, property and hospitality group, told Bursa Malaysia on May 12 that it plans to purchase a controlling stake in Ascot Sports, which has been re-issued a conditional sports betting licence by the Finance Ministry.

It said Tan has also agreed to guarantee that the company will make a cumulative net profit of at least RM375 million for the first three years of operation and had backed it by offering to deposit RM81.25 million worth of listed securities while Berjaya Corp will withhold RM125 million cash from the total purchase price.

Berjaya Corp said it will finance the initial consideration of RM400 million by undertaking a renounceable rights issue of up to RM614.46 million nominal value of 10-year eight per cent irredeemable convertible unsecured loan stocks (Iculs), done on the basis of one RM1 nominal value of Iculs for every eight Berjaya Corp shares owned.

“A portion of the funds raised will be used to pay the initial consideration of RM400 million with the remaining to be deployed for working capital of the group,” said the Berjaya Corp statement to Bursa Malaysia.

It added that Tan has undertaken to subscribe to his and his private companies’ entitlements in full, which would amount to at least RM400 million.

Ascot Sports, which is currently a dormant company, recorded net liabilities and net loss of RM11.2 million and RM4.6 million respectively for the financial year ended Dec 31, 2008.

Deputy Finance Minister Datuk Dr Awang Adek Hussein told reporters on May 6 that the government was considering issuing the licence to curb illegal gambling.

“There is some interest for us to examine otherwise there will be lots of bookies betting for the World Cup.

“So, whether this is necessarily a good thing for the government or whether we should try to regulate it so that we know how much is received from illegal betting, the government is looking into that,” he told reporters at the Parliament lobby.

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