Abu Dhabi’s IPIC says Malaysian fund 1MDB has paid settlement amount in full

Abu Dhabi’s government-owned International Petroleum Investment Co (IPIC) on Wednesday said Malaysian state fund 1Malaysia Development Berhad (1MDB) has made all required payments as part of a settlement agreement between the two.

1MDB was required to pay IPIC about $600m by December 31, as part of a settlement agreement reached in April after 1MDB defaulted on its bonds, causing the Abu Dhabi company to ask a London court to arbitrate over a claim totalling some $6.5bn.

1MDB had originally agreed to pay $1.2bn in two instalments to IPIC, with the first of about $600m due by July 31. 1MDB however missed the deadline due to the need to get “regulatory approvals” and made the payment in August instead.

“IPIC has now received all the funds required to be paid to IPIC by December 31 under the Settlement with the Minister of Finance (Inc) Malaysia and 1Malaysia Development Berhad and the Consent Award made on May 9, 2017,” IPIC said in a statement to the London Stock Exchange on Wednesday.

1MDB later on Wednesday said it has remitted in full to IPIC all funds required to be paid by December 31.

“All funds were paid from proceeds of the on-going rationalisation programme,” 1MDB said in a statement.

1MDB is the subject of money-laundering investigations in at least six countries, including the United States, Switzerland and Singapore. In civil lawsuits, the US Justice Department has alleged that about $4.5bn was misappropriated from 1MDB.

The Malaysian fund has denied any wrongdoing and Prime Minister Najib Razak, who founded 1MDB, has denied all allegations of corruption against him.