Prosecutors seek court change for Goldman Sachs’s 1MDB trial

Former Malaysian Prime Minister Najib Razak, center, arrives for his hearing in Kuala Lumpur. Najib is facing 42 charges of corruption, abuse of power and money laundering linked to the multibillion-dollar looting of 1MDB. (AP)
Updated 22 October 2019

Prosecutors seek court change for Goldman Sachs’s 1MDB trial

KUALA LUMPUR: Malaysian prosecutors on Tuesday sought a court change for Goldman Sachs’s criminal trial over its role in the alleged multibillion-dollar ransacking of state investment fund 1MDB.

Hisyam Teh Poh Teik, a lawyer for Goldman, said that prosecutors informed the magistrate court now hearing the case that they had applied to transfer it to the high court. He said the lower court scheduled an update on the transfer to be heard Dec. 16.

Prosecutors did not give any reasons for the transfer but a move to a higher court usually reflects the seriousness of the case.

Malaysian and US prosecutors allege bond sales organized by Goldman Sachs for 1MDB provided one of the means for associates of former Malaysian leader Najib Razak to steal billions from a fund that was ostensibly set up to accelerate Malaysia’s economic development.

Three Goldman subsidiaries and two former executives were charged in December for alleged breaches of securities laws including making false, misleading statements to investors. Another 17 more current and former directors at Goldman were charged in August with allegedly conniving to commit the massive fraud.

FASTFACT

Former Malaysian leader Najib Razak set up 1MDB when he took office in 2009.

Hisyam declined to comment on the allegations. Goldman has pleaded not guilty to the charges.

Najib set up 1MDB when he took office in 2009, but it accumulated billions in debts and US investigators allege at least $4.5 billion was stolen from the fund and laundered by Najib’s associates.

Public anger over the alleged corruption contributed to the election defeat of Najib’s long-ruling coalition in May 2018. Najib is now on trial for multiple charges of corruption over the 1MDB case and was in the same court building Tuesday for his second trial. Najib denies the charges. His wife and stepson also have been charged over the scandal.


HP rejects Xerox takeover bid, says open to acquiring Xerox instead

Updated 49 min 25 sec ago

HP rejects Xerox takeover bid, says open to acquiring Xerox instead

  • In rejecting Xerox's $33.5 billion cash-and-stock acquisition offer, HP said the offer “significantly” undervalued the personal computer maker
  • Xerox made the offer for HP on Nov. 5 after resolving its dispute with its joint venture partner Fujifilm Holdings Corp.
NEW YORK: HP Inc. said on Sunday it was open to exploring a bid for US printer maker Xerox Corp. after rebuffing a $33.5 billion cash-and-stock acquisition offer from the latter as “significantly” undervaluing the personal computer maker.
Xerox made the offer for HP, a company more than three times its size, on Nov. 5, after it resolved a dispute with its joint venture partner Fujifilm Holdings Corp. that represented billions of dollars in potential liabilities.
Responding to Xerox’s offer on Sunday, HP said in a statement that it would saddle the combined company with “outsized debt” and was not in the best interest of its shareholders.
However, HP left the door open for a deal that would involve it becoming the acquirer of Xerox, stating that it recognized the potential benefits of consolidation.
“With substantive engagement from Xerox management and access to diligence information on Xerox, we believe that we can quickly evaluate the merits of a potential transaction,” HP said in its statement.
The move puts pressure on Xerox to open its books to HP. Xerox did not immediately respond on Sunday to a request for comment on whether it will engage with HP in negotiations as the potential acquisition target, rather than the acquirer.
HP on Sunday published Xerox CEO John Visentin’s Nov. 5 offer letter to HP, in which he stated that his company was “prepared to devote all necessary resources to finalize our due diligence on an accelerated basis.”
Activist investor Carl Icahn, who took over Xerox’s board last year together with fellow billionaire businessman Darwin Deason, said in an interview with the Wall Street Journal last week that he was not set on a particular structure for a deal with HP, as long as a combination is achieved. Icahn has also amassed a 4% stake in HP.
Xerox had offered HP shareholders $22 per share that included $17 in cash and 0.137 Xerox shares for each HP share, according to the Nov. 5 letter. The offer would have resulted in HP shareholders owning about 48% of the combined company. HP shares ended trading on Friday at $20.18.
Many analysts have said there is merit in the companies combining to better cope with a stagnating printing market, but some cited challenges to integration, given their different offerings and pricing models.
Xerox scrapped its $6.1 billion deal to merge with Fujifilm last year under pressure from Icahn and Deason.
Xerox announced earlier this month it would sell its 25% stake in the joint venture for $2.3 billion. Fujifilm also agreed to drop a lawsuit against Xerox, which it was pursuing following their failed merger.

Test for new HP CEO
In 2011 as the centerpiece of its unsuccessful pivot to software. Little over a year later, it wrote off $8.8 billion, $5 billion of which it put down to accounting improprieties, misrepresentation and disclosure failures.
More recently, HP has been struggling with its printer business segment recently, with the division’s third-quarter revenue dropping 5% on-year. It has announced a cost-saving program worth more than $1 billion that could result in its shedding about 16% of its workforce, or about 9,000 employees, over the next few years.
Xerox’s stock has rallied under Visentin, who took over last year as CEO. However, HP said on Sunday that a decline in Xerox’s revenue since June 2018 from $10.2 billion to $9.2 “raises significant questions” regarding the trajectory of Xerox’s business and future prospects.