Last week, the ministry of trade and industry (MITI) named DreamEdge as the anchor company for the new national car project, and that announcement was followed by a post on social media by MCA president Datuk Seri Dr Wee Ka Siong, in which he criticised the government for allegedly going against the promise that the project would not utilise government money.

As reported by The Star, Wee had in his post attached a screenshot of a Companies Commission of Malaysia (SSM) document that showed that 53% of DreamEdge’s shares are owned by VentureTech. Another document showed that VentureTech is fully owned by the Malaysian Industry-Government Group for High Technology (MIGHT), which is in turn 100% owned by the government, leading Wee to question whether the project would involve public funds.

In a statement made in response to Wee’s post, DreamEdge CEO Khairil Adri Adnan revealed that the true shareholding of VentureTech in DreamEdge stands only at 10%.

An industry source familiar with the matter told paultan.org that DreamEdge’s current share structure has nothing to do with the new national car project. “DreamEdge entered into an agreement with VentureTech to raise capital for one of its engineering projects. This, in simple terms, is the offering of DreamEdge shares as collateral to raise funds needed to implement DreamEdge’s technology-based business strategies,” the source said.

This exchange, known as Redeemable Convertible Preference Shares (RCPS), was executed in 2017, and would be reflected in total in the SSM documents as seen in the documents circulating on social media and news portals.

“The SSM certificate shows the ordinary and RCPS as a combined total, and therefore the figures you see on the SSM document may mislead you to think VentureTech has a larger equity than it actually has,” the source explained.

“RCPS is a way to raise capital to fund projects, particularly seen in projects where there is need to secure their business interests of both parties,” he added.

The source also explained that the projects carried out by DreamEdge have given them a lot of experience in automotive design, and the public should wait for more announcements on the new national car project. “If the project is privately funded, they will reveal information when it is appropriate. This is a common business strategy practiced by automotive players around the world,” he said.

DreamEdge, a Cyberjaya-based innovation and digital engineering services company, said that the as-yet-unnamed new national car model will be a plus-sized B-segment sedan (initially mentioned as C-segment, and later corrected) equipped with a regular ICE or hybrid powertrain. It will be built via contract manufacturing, but the identity of the assembler is not yet known, nor are details on funding for the project.

The company said an engineering capability model mock-up will be revealed at the end of August, and the first prototype will be shown to the public in March 2020, with the final product scheduled for market introduction in March 2021. Daihatsu Motor Company will provide technology support for the programme, but the automaker will not have any equity in the project.