Penang CM says Lee Kah Choon replaced as PDC director a day prior to Umech Land exchange deal

• Lee has also resigned as the Penang CM's special investment adviser on Oct 2, Chow said, with a one-month notice given.

KUALA LUMPUR (Oct 10): A few hours after his former deputy Prof Dr P Ramasamy Palanisamy and special adviser Datuk Seri Lee Kah Choon called him out on his statement defending the sale of state-owned land to Umech Land Sdn Bhd, Penang Chief Minister (CM) Chow Kon Yeow (pictured) revealed that Lee had been replaced as Penang Development Corp (PDC) director a day prior to the state government entering the deal with Umech Land.

Chow said Lee was informed of his replacement as a director of the PDC on Sept 26 — a day before PDC inked the joint development agreement with Sunway Bhd’s 70%-owned Umech Land.

Under the deal, PDC agreed to exchange a 559-acre prime industrial land in Batu Kawan, Penang, to Umech Land in return for an entitlement to RM646.02 million or RM26.53 per sq ft — which the Penang Chinese Chamber of Commerce had claimed was way below the RM80 per sq ft price the land could have fetched on the open market. Umech Land plans to develop an industrial park known as Batu Kawan Industrial Park 2 that will have an estimated gross development value of RM3.5 billion on the land .

“On Sept 26, I informed Lee that he had been replaced as director of PDC following a new appointment to the said board. On Sept 27, Lee replied that he understood the situation,” Chow said in a statement via Facebook on Monday (Oct 9).

Lee has also resigned as the Penang CM's special investment adviser on Oct 2, Chow said, with a one-month notice given.

Chow’s statement came after the duo flagged a remark that Chow made last week that a committee had been set up in November last year to examine a proposal from Umech Construction Sdn Bhd as “misleading, unfair, and causes harm to our professional reputation”.

The pair said the meeting was actually not a due diligence meeting to evaluate whether Umech Construction was suitable to be awarded the contract, but was a meeting for Umech Construction to provide further details on its proposed development.

Note that it has been reported that Umech Construction is not a subsidiary of Sunway or affiliated to the group, and that the group has no equity interest in Umech Construction. Hence, Umech Construction is not related to Umech Land.

Chow, in response, said the November meeting was for Umech Construction to present its proposal, which he said was part of PDC’s due diligence process.

“Due diligence has been carried out continuously based on the comments of the sub-committee,” Chow said.

“All the identified and necessary information has been brought to a PDC board meeting on Feb 9, 2023. The board approved the sale of the land in a joint venture with Umech in principle, with all the conditions presented in the same meeting,” he added.

Read also: 

Penang Chinese Chamber of Commerce questions PDC’s sale of 559-acre land to Umech Construction at ‘below market’ price

Sunway says no valuation carried out by independent registered valuer on RM646 mil Batu Kawan land deal)

Aspen clarifies decade-old land buy from PDC ‘fundamentally different’ from Umech's BKIP2 deal

‘Penang CM Chow’s statement is misleading; we did not approve the land deal with Umech’ — Ramasamy and Lee Kah Choon

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