RESUMEN DE LA HIPÓTESIS DE LA CAUSACIÓN FORMATIVA

72 See FEER, 19:10:1989. Also confirmed in author's interview with Wan Azmi, 13:1:1992. General Lumber was formerly owned by a prominent Chinese businessman from Johore, Datuk Kang Kok Seng and his family. As a Chinese-owned company it apparently had had increasing difficulty in obtaining timber concessions.

For Wan Azmi the attraction of General Lumber was that as a publicly-listed company it provided the vehicle for him to raise funds and launch his own corporate career. In that regard Wan Azmi later told the Far Eastern Economic Review that 'General Lumber's problem was that it neither had cash flow nor collateral. We had to go with a series of acquisitions of landed assets where the medium of settlement could be General Lumber shares. This allowed us, using the acquisitions as collateral, to source funds to activate the core business' (FEER, 19:11:1989). W an Azmi and his brother-in-law , Nik Mahmood Haji Nik Hassan, then set about creating one of the few fully integrated timber operations in Southeast Asia. This coincided with the Malaysian Government's targetting of value-added wood products as a promising future growth area. Despite initially funding acquisitions through new share issues, General Lumber's share price leapt more than 200 per cent as brokers assumed that General Lumber would be a major beneficiary of the furniture industry's relocation from South Korea and Taiwan73 where costs had risen sharply (FEER, 19:10:1989).

While vertical integration within the timber business moderated the cyclical features of that industry, General Lumber sought to ameliorate these further by the diversification of its activities.74 Consequently since the late 1980's General Lumber branched into the manufacture of resins and compounds for the plastics industry, property development (through the acquisition of Sri Damansara) and stockbroking through a stake in Rashid Hussein Bhd. By December 1991 General Lumber's original core activity in primary logging was a relatively minor component of the groups activities and, to reflect that, the com pany changed its name to Land and G eneral Bhd (NST, 6:12:1991). The transform ation of Land and General from what had been a small struggling timber company to a profitable and diversified concern was a testament to Wan Azmi's corporate skills and was reflected in an assessment by a Malaysian business magazine (Corporate W orld, 7:1992), which ranked the com pany thirty-six in terms of profitability in comparison with more than 350 companies listed on the Kuala Lumpur Stock Exchange. Although Land and General was the centrepiece o f Wan Azmi's business holdings, it

^3 In the late 1980's General Lumber entered into a strategic alliance with one o f Taiwan's top furniture exporters and also bought UMW Industries (UMWI), from an arm o f the Pahang state government. UMWI manufactured furniture for export to the US, Britain and Japan (FEER, 19:10:1989).

^4 Political risks, that is the growing power o f the green lobby and international concern over the logging o f tropical rainforests, provided a secondary justification for the diversification of General Lumber. (By the late 1980s General Lumber was already a substantial 'logger' in the region. In a $1.6 billion deal it reportedly secured a 200,000ha forest concession in Papua New Guinea. In Indonesia Azmi entered into a joint venture with a local company, Kuala Langsa, to log 5,000 ha with an option to log a further 10,000ha in Sumatra.) See The Star, 7:6:1990.

nevertheless constituted only part of a diverse investment portfolio which included stakes in a range of public companies including Gadek Bhd, Malaysian Resources, Cycle and Carriage, Cold Storage Bhd (the latter a company controlled by Daim in the early

1980's), and an overseas bank, the Southeast Asia Bank in Mauritius.

In the course of his corporate rise Wan Azmi clearly benefitted from state support and the friendships of other powerful businessmen, Bumiputra and Chinese alike. However, on closer examination, a reciprocity was often apparent in those relationships that belie easy categorization so while his business investments on occasion appear to have had a 'symmetry' with those of the party, by the early nineties he was generally regarded as a relatively independent corporate player. This apparent mix of roles can best be illustrated by reference to a number of his business dealings and relationships.

The coincidence between the corporate interests of the party and those of Wan Azmi appeared most notable in his purchase of assets of the hotel and property group, Faber Merlin. In our earlier survey of the Fleet Group, it was noted how in the early 1980s one of the Group's most important acquisitions was Faber Merlin, a company which after the recession and property slump of the mid-eighties was encumbered with large debts. In an attempt to salvage Faber, the Fleet Group called on several companies to either take-over Faber or purchase some of its assets, but none were prepared to do so (Asiaweek, 30:9:1985). With the likely prospect of being wound-up, Faber was 'saved' when its principal asset, the Kuala Lumpur Merlin, was purchased in February 1990 by Ampang Hotel Sdn Bhd for $113 million - a company, which through various shareholdings, was linked ultimately to Wan Azmi75. Shortly thereafter Faber's financial problems were resolved after a restructuring exercise and its movement into UMNO's Renong group.76

Another instance where Wan Azmi's corporate investments also appeared to serve those of the party was his purchase in June 1990 of Nanyang Press, publisher of one of Malaysia's most influential Chinese newspapers, Nanyang Siang Pau. At the time many

75 Ampang Hotel Sdn Bhd was owned by Singapore-based Ampang Investment Pty Ltd which was a