Wednesday, 8 August 2012

Khoda Pahar aur Nikla Mara Hua Chooha!

Dear Editor,

Grateful if you publish the following response since he freely mentioned my name in his press conference and on capital talk Geo TV:


Imtiaz Hydari

i was amazed but more amused as i witnessed the Sherlock Homes style performance of Khawaja Asif on television. Khoda Pahar aur Nikla Mara Hua Chooha!

It is appropriate to set the record straight since his great discovery from publicly disclosed documents was gathering false alarms and in the process was hurting the finest public charity in Pakistan. If he is a man of any substance, he will appear again on television to Apologise to Imran Khan, SKMT and Imtiaz Hydari. Let me tell you why?

First the facts on the investment:

Shaukat Khanum Memorial Trust made a long-term real estate investment with HBG in 2008 when the market fundamentals across GCC were excellent, with a plan to develop it into a project. The decision by SKMT to invest with HBG was not a speculative play, but a long-term investment based on sound judgment of the market fundamentals in a solid real estate, prime location in Muscat in which HBG itself has committed a substantial amount.

It is of'course a fact that Imran Khan had nothing to do with the decision as it was taken by the investment committee of the board of directors. I being a director in SKMT at the time, refrained from voting to avoid a conflict of interest.

There is a misconception being propagated that just because the investment is through an offshore company, it is akin to a ‘benami ' transaction. This is a totally false representation as private equity investments across the world are conducted from such jurisdictions because they are considered investment-friendly jurisdictions.

Pursuant to the severe correction in the real estate market following the Global economic crisis, it was rightly decided to defer the project. The investment has no leverage. However given the fact there has been impairment in land value, HBG has taken steps to absorb the impairment in value by granting increased shares to SKMT i.e. the reduced value of Sugarland shares will be compensated by higher percentage shareholding of SKMT in Sugarland BVI. This preserves and protects SKMT investment. Additionally, HBG has also provided an undertaking to assist SKMT's exit from the investment with Capital Protected.

Now to his specific accusations:

1. A case of Money laundering? - The answer is an emphatic NO. The investment was not transferred out of Pakistan. It was not for any personal gain. The investment was from the Endowment Fund not Zakat money.

2. An attempt to hide the transaction so we can wonder at his discovery? - Definitely NOT. It is publicly disclosed

3. An  SPV (special purpose vehicle) with an off shore jurisdiction is benami? - SORRY Khawaja Sahib, you are wrong. The  entities in this investment have names and declared shareholders who are audited by one of the big four accounting firms

4. Investment was speculative and the real estate worthless? - No it was NOT, as explained above. This is prime land in prime location with excellent development potential

4.The investment has lost value resulting in a major loss for SKMT? - Khawaja Asif reads the Balance sheet but is unable to differentiate between a note to the accounts and the actual adjustment for impairment in the accounts. No loss has been recorded even though impairment has taken place as explained above

5. Capital Protection/Guarantee issued by a corporate entity is worthless? - How does Khawja Asif know? does he know the standing or stature of the corporate and the circumstances surrounding it? unfortunately he has not bothered to make any enquiries.

Now what can be the purpose of his sensational out burst?

Unable to defend the allegations of money laundering and corruption against his own leadership he has to find something against Imran Khan, the most clean and honest political leader in Pakistan - and Good heavens, all Mr Sherlock Homes could find was a mara hua chooha? - desperately clinging to straws but in the process hurting SKMT and the poor people of Pakistan.

Shame on you Khawaja Asif!

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