Arul Kandsamy-Abu Dhabi's administrator overseeing the liquidation of 1 MDB

by Ganesh Sahathevan

Sarawak Report's revelation that 1 MDB CEO Arul Kandasamy had misled its board  about the existence of cash turned units at a bank in Singapore contains this interesting snippet:

The CEO had told his bemused board members that Deutsche Bank was preventing him from repatriating the money, because they were demanding that he keep the Singapore cash account as collateral for another almost identical sum of US$975 million they had loaned to 1MDB.

Readers will be aware that Deutsche Bank has since demanded  and received  early repayment of that loan,and that 1 MDB had to go cap in hand to IPIC for some USD 1 billion to meet the Deutsche Bank demand. Readers will also be aware that reports about Deutsche's concerns disclosed that Deutsche lead a syndicate of banks that included Arul's employer,Abu Dhabi Commercial Bank :

A consortium of banks led by Deutsche Bank has asked for their US$975mil loan to be repaid by 1Malaysia Development Bhd (1MDB) less than four months earlier ahead of its due date, a report by Singapore Business Times said.

The loan, which was syndicated to five Gulf banks including Abu Dhabi Commercial Bank, is guaranteed by the Malaysian Government.

What has not been disclosed however is that  Arul remained an employee of Abu Dhabi Commercial Bank even when he was appointed CEO of 1MDB. This  is a matter  of public record but not something that Arul has cared to mention,even as he burnished his skills and credentials. 

Nevertheless, the fact of Arul's ongoing employment by Abu Dhabi Commercial even after being appointed 1 MDB CEO inn January 2015   can be deduced from (among other documents in the public domain) an announcement to the London Stock Exchange published on 4 June 2015 which stated:

Global Investment House ("Global" or the "Company") announced that NCH Ventures S.P.C. the Company's 70% shareholder, changed its nominee on the Board of the Company from Mr. Arul Kandasamy to Mr. Bassam Yammine. 

At Global Investment  Arul's job was to oversee a debt workout on behalf of Abu Dhabi Commercial and other lenders wanting to recover moneys lent  to  Global Investment. NCH Ventures is their special purpose company (SPV) formed to facilitate that recovery.

Given the Sarawak Report  revelations which suggest Arul has been less than honest in dealing with his 1 MDB board, it  does seem as if Arul's role at 1 MDB is no different from his role at Global Investment, except that at 1 MDB he has been put in charge of day-to-day operations. One can therefore conclude that the so-called "rationalisation", shown on this blog to be a sham, is really a liquidation ordered by 1 MDB's Middle Eastern creditors , supervised by their man Arul Kandasamy.

END 

NOTES 

Arul Kandasamy, director, Global Investment House K.P.S.C   representing NCH Ventures SPC

The following is an extract from the  Global Investment House K.P.S.C, website:

Arul KandasamyDirector (representing NCH Ventures S.P.C.) Mr. Kandasamy is the founder and Head of the Investment Banking Group at Abu Dhabi Commercial Bank (ADCB). He oversees an integrated debt financing, equity and advisory business comprising Real Estate & Asset Finance, Capital Markets & Syndications, Structured & Principal Finance, Advisory and Investment Management. He started his career in Investment Banking with Credit Agricole Indosuez London, moved to the Middle East in 2004 to head their Islamic Banking then joined Barclays Capital as head of Islamic Financing. Mr. Kandasamy holds an LL.B from the London School of Economics, an LL.M from University College London and is a UK qualified Barrister.

The nature and purpose of the NCH Ventures S.P.C is described in this following extract from a Global press release:

Global Investment House (Global) is delighted to announce that it has concluded the implementation of restructuring agreements entered into with all of its financiers on 4 December 2012, thereby bringing a comprehensive solution to the Company’s capital structure.
  
As previously announced, the restructuring transaction resulted in a separation of Global’s core fee businesses from its non-core principal investments and a transfer of its substantially entire debt obligations, resulting in Global effectively becoming a debt-free company.  

The Company has issued 1,222,350,000 new shares at par value of KD0.100 per share to another  Special Purpose Entity namely NCH Ventures S.P.C. (NCH) giving it a 70% stake in Global.    NCH has assumed US$428.8 million of the Company’s debt obligations.

Maha Al-Ghunaim, Chairperson and Managing Director of Global commented:

We are extremely grateful for the extra-ordinary efforts of the Co-ordinating Committee of financiers consisting of Abu Dhabi Commercial Bank (the Chair of the Co-Com).......

Padmanabha Mishra from Abu Dhabi Commercial Bank PJSC and Chair of the Coordinating Committee of Financiers, added:
 
“The Co-ordinating Committee is highly appreciative of the overwhelming support from financiers that has allowed for this successful outcome today. Global’s senior management team has displayed proactivity, professionalism and transparency throughout the process, which have allowed us to structure a unique solution that can serve as a template for other debt restructurings in the region.
 
We affirm our continued support to the Company and wish the management and Board every success in driving forward the market leading core business lines of the Company. I would like to thank my colleagues at the Co-ordinating Committee and its financial and legal advisors. Also I would like to extend my thanks to the previous chair of the Co-ordinating Committee, Mr. Arul Kandasamy of ADCB.”

Arul Kandasamy's  Resume(Source: Bloomberg)

Arul Kanda Kandasamy President and Group Executive Director, 1Malaysia Development Berhad

Age	Total Calculated Compensation	This person is connected to 2 Board Members in 2 different organizations across 7 different industries. See Board Relationships
38	--

Background

Mr. Arul Kanda Kandasamy has been the President and Group Executive Director at 1Malaysia Development Berhad since January 2015. Mr.Kandasamy is a senior management leader and investment banker, with extensive experience in structured finance, corporate finance, and restructuring across multiple markets including London, the Middle East, and Malaysia. Previously, he served as an Executive Vice-President and Head of Investment Banking at Abu Dhabi Commercial Bank P.J.S.C. Mr.Kandasamy had joined the Abu Dhabi Commercial Bank in July 2008. Prior to this, he worked in several leadership positions at Barclays Capital and Credit Agricole. Mr. Kandasamy was the Director of Investment Banking and Financing Solutions at Barclays Capital plc. He served as the Head of Islamic Financing Solutions at Barclays Capital, Dubai from September 2006 to July 2008. Mr. Kandasamy was the Head of Islamic Banking, London at CALYON from July 2005 to August 2006. He had earlier served as the Director of Capital Markets, Bahrain at the CALYON from June 2004 to June 2005. Mr. Kandasamy was an Associate Director of Securitization, London at the CALYON from July 2003 to May 2004. He also served as a Securitization Analyst, London at the CALYON from January 2002 to June 2003. Mr. Kandasamy is a Board Member of Global Investment House K.P.S.C. He served as a Non-Independent Non-Executive Director of RHB Investment Bank Berhad from July 2009 to May 10, 2011. Mr. Kandasamy served as a Non-Independent Non-Executive Director of RHB Capital Berhad from July 20, 2009 to May 10, 2011. He served as a Director of RHB Islamic Bank Berhad. Mr. Kandasamy served as a Non-Independent Non-Executive Director of RHB Bank Berhad since July 20, 2009. He is a UK-qualified Barrister. Mr. Kandasamy received an LLM with distinction in Corporate and Commercial Law from University College London in 2000. He also earned an LLB degree from the The London School of Economics and Political Science in 1998.