KUALA LUMPUR: Embattled state investment company 1Malaysia Development Bhd. received an extension to make a payment of more than $600 million to an Abu Dhabi sovereign wealth fund after missing a deadline last month.
1MDB is in talks with International Petroleum Investment Co. on the new arbitration settlement date, Malaysian Treasury Secretary General Irwan Serigar Abdullah told reporters on Tuesday. Irwan is also the chairman of 1MDB’s board of directors.
“It’s a question of time,” Irwan said. “In due course when the time comes, we will pay off.”
1MDB was due to make a payment to IPIC by the end of July and had a five-business day grace period to meet the obligation. The settlement would have been made from proceeds of a 1MDB rationaliSation plan that involved the monetization of so-called investment fund units.
The money that was expected to arrive last month had been delayed till August, 1MDB said in a statement last week. The holdup was due to the need for additional regulatory approvals, it said. 1MDB didn’t foresee the time it would take to sell the units and meet regulatory requirements, Irwan said Tuesday.
The payment to IPIC is part of a US$1.2bil settlement over a debt dispute and is half the amount 1MDB and the Malaysian finance ministry agreed to make to IPIC. The second installment is due by the end of 2017.