GGF DENIES COMMITTING CRIME IN THAI RICE DEAL

By D. Arul Rajoo

BANGKOK, Dec 24 (Bernama) -- Malaysian-based GGF Group of Companies has
denied committing any crime when it won bids to invest in the construction of
rice silo in Thailand.

Chairman Dr Ronald Heng said he was informed that the Department of
Special Investigation (DSI) had released a report against its joint-venture
company, GGF Thailand, earlier today which alleged that they had used a Thai
nominee.

It was not true that the company had used a Thai nominee to represent GGF
Malaysia, he said.

"It is common practice that the true Thai partners may use other Thai
citizens to represent their interests temporarily until after the project is
awarded.

"This is not a crime as Thai citizens are representing other Thai citizens,"
he said in a statement Wednesday.

Heng said that in the case of GGF Thailand, the local Thai equity
partners decided to appoint another Thai citizen to represent their Thai local
51-per cent ownership.

"As agreed with our Thai equity partners, they will reveal their names after
the award of contract and restructuring of the capital," he said.

In September, the company secured a US$200 million contract to build, own
and operate 400 high-tech silos in 10 provinces.

The deal was immediately criticised by Thai rice exporters as GGF was also
appointed as the authorised representative to sell up to two million tonnes of
rice, yearly, from government stocks.

Following the controversy, GGF Thailand recently submitted a letter
cancelling its commitment to sell two million tonnes of government rice to end
questions over whether it had breached the Foreign Business Act.

Heng said they had absolute proof that the company was proceeding with the
project funding of US$200 million via a syndication loan with its bankers which
included an offshore bank in Labuan, Malaysia.

"Furthermore, we can also prove that we are processing a standby fund of
US$500 million for the trading of rice in Thailand," said Heng, who also alleged
that there were attempts to undermine the deal and blackmail the company by a
DSI official.

-- BERNAMA