March 18, 2024
KUALA LUMPUR – A former aide of Malaysia’s Prime Minister Anwar Ibrahim has become a substantial shareholder of technology services provider HeiTech Padu, which is in the running for a billion-ringgit deal. The move has raised concerns of favouritism and undue influence in the award of government contracts.
Datuk Farhash Wafa Salvador, Datuk Seri Anwar’s former political secretary, mopped up 16.1 million shares amounting to 15.9 per cent in HeiTech Padu via a private company named Rosette Partners, according to HeiTech’s filing to the local stock exchange on March 14. The acquisition price for his shares was not disclosed.
HeiTech’s share price surged 7 per cent on March 15 to close at RM2.60.
This is the fifth publicly listed company that Mr Farhash, known as Mr Anwar’s “blue-eyed boy” within his Parti Keadilan Rakyat (PKR), has been linked to since the Premier was elected to power more than a year ago.
Mr Farhash’s emergence as a major investor comes shortly after it was reported that HeiTech Padu was among the front runners to develop the government’s National Integrated Immigration System worth more than RM1 billion (S$284 million) which seeks to incorporate biometric technology at the electronic gates of the country’s immigration checkpoints.
The project will replace the 20-year-old Malaysian Immigration System, which is currently being maintained by HeiTech Padu but is outdated and incapable of meeting future immigration needs, said Home Minister Saifuddin Nasution Ismail in May 2023.
A source within the industry told The Straits Times that Mr Farhash’s entry into publicly listed companies helps “open doors for these businesses to the Prime Minister’s Office”, and gives better insight into government direction on various infrastructure projects.
Within the first six months of Mr Anwar becoming premier in November 2022, Mr Farhash, 41, secured three company chairmanships – in convenience store chain 7-Eleven Malaysia Holdings, stockbroking firm Apex Equity Holdings and fintech company Excel Force MSC.
While there are perceived benefits for companies to engage Mr Farhash in their businesses, such as easier access to government contracts, political analysts say it has negative repercussions for transparency and public trust in the government’s integrity.
The former Perak PKR chief does not hold any positions in government, but his close ties to the Premier raises concerns about the fairness of the business environment and undue influence over decisions on awarding government contracts, say analysts.
University of Malaya sociopolitical analyst Awang Azman Pawi said: “It could also create a perception of corruption or crony capitalism, which could have broader implications for the country’s economic and political stability. It undermines the principles of fair competition and transparency in business dealings, as other companies may not have the same level of access or influence.”
Mr Farhash has dismissed such concerns as “nonsense”, saying that his stake in HeiTech was part of an investment strategy to invest in bumiputera tech companies.
“I felt those listed companies are undervalued and have massive potential,” Mr Farhash said, adding that he and his partner had on March 13 acquired a 4.97 per cent stake in Theta Edge, a competitor of HeiTech.
“If I was betting on HeiTech, why would I invest in Theta Edge at the same time?”
Mr Farhash was appointed group chairman of Apex Equity Holdings in December 2022, not long after an investigation was launched into the company by the Securities Commission. The regulator filed a legal suit for breach of capital market rules but withdrew it in December 2023.
In January 2023, Mr Farhash was appointed chairman of 7-Eleven Malaysia Holdings, which is 22.36 per cent owned by politically connected tycoon Vincent Tan, the second-largest shareholder. Mr Farhash is also the director of Berjaya Construction, the construction arm of Berjaya Land, which is controlled by Tan Sri Tan.
The Berjaya Group controlled by Mr Tan is among seven local and international consortiums that in January 2024 submitted concept proposals to revive the Kuala Lumpur-Singapore high-speed rail project. The group is also believed to be bidding to install a barrier-free system at toll plazas across the country.
According to filings with stock exchange Bursa Malaysia, Mr Farhash has a degree in business administration and has “more than a decade’s worth of experience in the field of business, consultancy and advisory”.