Family feud Rips Apart Sarawak Giant CMS: Boardroom Chaos, RM1B Disaster & Decades of Red Flags.

Taib Family Feud Tears Apart Cahya Mata Sarawak (CMS): A Deep Dive into the Latest Boardroom Chaos, Financial Red Alerts, and Decades of Governance Warning Signs

• A once-dominant infrastructure powerhouse in East Malaysia is now the epicentre of a very public family civil war, and the fallout could reshape Sarawak’s political and business landscape heading into the 2027 state elections.
• Cahya Mata Sarawak Bhd (CMS), the state’s largest cement and construction materials player with a 3,000-strong workforce, has become ground zero for a bitter clash between the two sons of the late Tun Taib Mahmud, Sarawak’s longest-serving chief minister and former governor.
• What began as a private inheritance dispute has spilt into courtrooms, boardrooms, and now threatens the company’s very solvency.

The Latest Update: Frozen Out, Suits Flying, and an AGM Showdown

As of early May 2026, the situation has escalated dramatically:

• Datuk Seri Mahmud Abu Bekir (elder son, until recently deputy chairman) has been physically barred from board meetings despite a court order lifting an earlier injunction. He is now a non-executive director, following a demotion on 7 April 2026.
• Mahmud has been demanding detailed financial records from key subsidiaries since 2025. He filed suit on 5 March 2025, alleging that the company is illegally withholding information.
• CMS retaliated with its own suit against Mahmud and associates, accusing them of breach of fiduciary duty and conspiracy over a stalled 2019 IT/ERP project awarded to a firm linked to Mahmud. The company secured (and later lost) an order barring him from meetings.
• Even after the barring order was set aside in January 2026, the board continues to cite “conflict of interest” to keep him out.

The 25 May 2026 Annual General Meeting (AGM) is now the critical flashpoint.

• Four directors, including managing director Datuk Seri Sulaiman Abdul Rahman (Taib’s younger son), are up for re-election.
• Shareholders could tip the board balance one way or the other, potentially turning the family feud into a full-blown war for corporate control.

The Financial Time Bomb: RM1 Billion Phosphate Gamble

While the family drama makes headlines, the numbers paint an even darker picture:

• Group net profit crashed from RM290 million (2022) → RM82m (2023) → RM125m (2024) → just RM40 million in 2025.
• Comprehensive income fell to a paltry RM2 million in 2025 after forex losses and associate write-downs.
• The core cement business remains profitable (RM161m pre-tax in 2025), but new ventures are bleeding the company dry.
• Star culprit: the phosphate plant subsidiary. Originally slated for 2019, it was delayed repeatedly. Sarawak Energy cut power in 2023 over unpaid bills. Even after reconnection in September 2025, the venture racked up half a billion ringgit in losses, including RM146 million in 2025 alone.
• Initial capex: RM645 million. Now, it has ballooned to RM1 billion (after CMS pumped in RM325 million in loans). → CMS’s entire market capitalisation is only ~RM1.2 billion.
• Sarawak Energy is suing the subsidiary for RM342 million in unpaid electricity, now in arbitration.
• Additional RM300+ million in write-offs and impairments booked in 2023–2024.

Net current assets stand at only RM551 million. One bad arbitration outcome or further delays could push the company to the brink of insolvency.

History of Red Flags: From Political Empire to Global Scrutiny

The Taib family’s control of CMS cannot be separated from its deeper history:

• Under Taib’s rule (Chief Minister 1981–2014, Governor until he died in 2024), CMS enjoyed a virtual monopoly on cement supply and key infrastructure contracts in Sarawak. Virtually every major project, including roads, dams, and property, flowed through the group.
• The family’s stake has shrunk from over 60% in the 1990s to ~24% today, but effective control remains tight.
• State-linked entities once held a third of the shares; most have been sold down, but the political proximity remains.

Allegations of concealed wealth:

• Investigative reports (including Global Witness) have long claimed the Taib family fortune, estimated by some at over US$20 billion, was built through logging, plantations and construction, allegedly routed via family members and proxies.
• The family has consistently denied wrongdoing.

HSBC money-laundering red flags:

• In 2012, Global Witness exposed suspicious transactions involving Sarawak-linked firms and HSBC.
• The bank later paid a US$1.9 billion fine to US authorities, one of the largest such settlements at the time. No criminal charges were ever brought against the Taibs, but the episode remains a major governance stain.
• Taib’s death in 2024 triggered an even larger inheritance battle involving children from his first marriage and his second wife, Toh Puan Raghad Kurdi Taib. Legal proceedings could surface more details.

These are not ancient history.

• The same governance culture of opaque related-party dealings, political patronage, and resistance to external scrutiny appears to be playing out in the current phosphate disaster and boardroom lockout.

Risks of Dealing with CMS and the Taib Controllers: Proceed with Extreme Caution

For investors, contractors, lenders, or joint-venture partners, the red flags are flashing bright red:

1. Governance & Control Risk Family feud has paralysed normal board oversight. Key decisions (including the phosphate project) appear to be driven by internal power struggles rather than by commercial logic.
2. Financial & Insolvency Risk The phosphate plant alone could wipe out the company’s market value. Ongoing arbitration, further impairments, and weak comprehensive income make the balance sheet fragile.
3. Political & Reputational Risk CMS remains deeply intertwined with Sarawak’s ruling elite. Any major scandal could become election ammunition in 2027. Association with the Taib name still carries decades of corruption allegations, even if unproven in court.
4. Transparency Risk A director (and major shareholder family member) claims he cannot access basic subsidiary accounts. Bursa Malaysia and Securities Commission complaints have gone largely unanswered so far.
5. Related-Party & Conflict Risk History of awarding contracts to family-linked entities (see the ERP project) raises classic minority-shareholder protection concerns.
6. Legacy Legal & PR Risk Any escalation of the inheritance war could drag previously private financial arrangements into open court with unpredictable consequences for CMS’s credit profile and partner confidence.

Bottom line:

• CMS is no longer the “only game in town”; it was under Taib’s iron grip. Its monopoly days are gone, its new ventures are haemorrhaging cash, and its controlling family is at war with itself.
• The May 25 AGM may decide the next chapter.

THE STRAITS TIMES = NEWS

[KUALA LUMPUR] Datuk Seri Mahmud Abu Bekir has a seat on the board of the company built by his father, the late former Sarawak governor Taib Mahmud. But he cannot enter the room to claim it.

The dominant infrastructure firm in Malaysia’s largest state has become mired in both court and boardroom tussles between the two sons of Tun Taib, who was also Sarawak’s longest-serving chief minister.

The feud comes as Cahya Mata Sarawak (CMS) has seen a downturn in recent years, with write-offs and loss-making ventures dragging on its profitability. 

Mahmud, Taib’s elder son and CMS deputy chairman until he was demoted on Apr 7 to a non-executive director, has found himself frozen out of board meetings. This was after he sought detailed financial accounts from several CMS subsidiaries, while suits and counter-suits have multiplied since March 2025.

Given CMS’s proximity to Sarawak’s political elite, the company's fortunes – with a 3,000-strong workforce, one of the largest here, even after including state-run enterprises – could well become campaign fodder at state polls due by April 2027.

Its May 25 annual general meeting (AGM) is shaping up to be a key turning point, with four board members – including managing director Sulaiman Abdul Rahman, Taib’s younger son – up for re-election.

The AGM takes place even as a huge RM1 billion (S$323 million) gamble on a new phosphate plant threatens to sink the company entirely. To put this into context, CMS’s total market capitalisation is about RM1.2 billion – making this a substantial bet.

A dynasty at war with itself

The Taibs control about 24 per cent of shares – it was over 60 per cent in the 1990s – in two separate tranches.

As recently as 2020, state-linked investment arms owned a third of the company. However, most of these stakes have been pared down, including that of the Sarawak Economic Development Corporation, which is now below 5 per cent.

Taib’s death in 2024 deepened a battle between his children and their stepmother, Raghad Kurdi Taib, over what some believe is the estate of Malaysia’s richest family, valued in excess of US$20 billion. This wealth was allegedly accumulated through logging, agriculture, and construction businesses, concealed behind a web of family members or political proxies.

The Taibs have denied such claims and allegations of wrongdoing. While no criminal culpability has ever been proven against any of the Taibs, financial services from global banking giant HSBC used by Sarawakian firms owned or controlled by the family were flagged as part of suspicious transactions. This was revealed by the investigative environmental non-governmental organisation Global Witness shortly before the bank paid a US$1.9 billion fine in December 2012 to settle money-laundering investigations in the US.

If the ongoing family feud turns into a no-holds-barred contest pitting Taib’s siblings and children from his first marriage against Toh Puan Raghad, it could see new and damning details divulged in the course of legal proceedings.

The tussle over CMS now threatens further exposure, especially if the Taib scions take their dispute beyond the firm itself.

This makes it a high-stakes battle not just for those making claims to the Taib fortune, but also for Sarawak’s political elite. The dominant Parti Pesaka Bumiputera Bersatu has held power in various incarnations since the first state polls six decades ago, repeatedly dodging accusations of abuses along the way.

The Gabungan Parti Sarawak coalition it leads is expected to win the state election easily. However, antipathy towards Taib towards the end of his chief ministership led to gains for parties that are now part of Malaysian Prime Minister Anwar Ibrahim’s Pakatan Harapan alliance.

The numbers behind the feud

CMS was the only game in town for cement supply and telecommunications infrastructure when Taib was chief minister from 1981 to 2014 and for a further decade as governor. But the company that once had an iron grip on Sarawak’s building blocks is now wobbling.

Practically every infrastructure project, from property development to roads to dams, requires cement from CMS.

But its earnings have dipped since 2022, a year after Datuk Seri Sulaiman was appointed managing director.

From a high of RM290 million in 2022, CMS recorded profits after tax of RM82 million in 2023 and RM125 million in 2024, then fell to RM40 million in 2025.

The situation appears even grimmer from the perspective of comprehensive income, which fell from RM106 million in 2024 to just RM2 million the following year, after accounting for foreign exchange losses, losses from associated companies, and fair value adjustments on assets and liabilities.

Crucially, CMS’s core cement business is not the problem. It delivered pre-tax profits of RM161 million in 2025, higher than RM149 million in 2024 and RM146 million in 2023, compared with the group’s RM109 million total. This indicates that newer business ventures are the ones making a loss and dragging CMS’s performance.

The most significant is the phosphates subsidiary. A plant that was supposed to open as early as 2019 never did. In 2023, Sarawak Energy cut off its electricity supply due to unpaid bills. By the time power was restored in September 2025, the venture had accumulated half a billion ringgit in losses – including RM146 million in 2025 alone.

In CMS’s 2025 annual report issued on Apr 24, Sulaiman cited “higher pre-commissioning costs” as the reason for this.

CMS now expects the plant to begin operations in the third quarter of 2026. The initial capital outlay of RM645 million has ballooned to RM1 billion, including RM325 million in loan advances from CMS to the phosphates subsidiary.

Added to that is the RM342 million Sarawak Energy is suing for unpaid electricity bills from the phosphates arm – a matter now under arbitration. This single venture alone could bring CMS onto the brink of insolvency, as its net current assets stand at RM551 million.

Aside from losses and potential legal costs, over RM300 million was recorded as write-offs and impairments between 2023 and 2024.

Battle for the boardroom

It is against this backdrop of mounting losses that Mahmud’s bid to scrutinise CMS’s books has taken on added urgency.

Mahmud has, since 2025, sought financial and board documents that he claims CMS is illegally withholding from him, given his position as a board member. He filed a suit on Mar 5, 2025, demanding the information. Regulators such as Bursa Malaysia and the Securities Commission have not yet responded substantively to his complaints.

Just two weeks later, CMS sued Mahmud and others involved in an enterprise resource planning system project to unify the entire group’s IT systems and databases. This project was awarded to a firm controlled by Mahmud and his associates in 2019, but has not yet been implemented.

The company also sued Mahmud and others aligned with him for breach of fiduciary duty and conspiracy to injure the company. The suit was based on what it called "frivolous and unsubstantiated allegations," and it obtained a court order barring him from attending board meetings since April 2025.

Even after the order was set aside in January 2026, Mahmud was blocked from attending several meetings, as the board cited a “conflict of interest” due to the ongoing suit seeking access to company documents. On Apr 2, he filed a suit to affirm his right to attend board meetings as a CMS director.

May’s AGM is likely the last chance for shareholders to intervene in CMS’ direction before Sarawak heads to the polls. Should Mahmud succeed in installing directors aligned to him, it would shift the balance of the board – and in all probability, tip the bitter contest with his brother Sulaiman into a new and unpredictable phase.

THE STRAITS TIMES

https://www.businesstimes.com.sg/international/asean/board-frozen-out-taib-family-feud-tearing-sarawak-construction-giant-apart?utm_source=iphone&utm_medium=app_share

Main News Articles (Latest Feud Coverage)

• On the board but frozen out: The Taib family feud tearing Sarawak construction giant apart (Business Times / Straits Times original) https://www.businesstimes.com.sg/international/asean/board-frozen-out-taib-family-feud-tearing-sarawak-construction-giant-apart
• Straits Times full version https://www.straitstimes.com/asia/se-asia/hes-on-the-board-but-frozen-out-the-taib-family-feud-tearing-sarawak-construction-giant-apart
• CMS Governance Crisis Deepens Amid Taib Family Feud (Mission Media summary) https://missionmedia.asia/cahya-mata-sarawak-taib-family-governance-feud/
• Cahya Mata's Abu Bekir sues company over alleged board meeting exclusion (The Edge Malaysia, 7 Apr 2026) https://theedgemalaysia.com/node/798955
• Cahya Mata deputy chairman claims board used 'conflict-of-interest' to avoid scrutiny https://www.scoop.my/corporate/285991/cahya-mata-deputy-chairman-claims-board-used-conflict-of-interest-to-avoid-scrutiny/

Financial Reports & Company Documents

• CMS Integrated Annual Report 2025 (full PDF) https://cmsb.irplc.com/investor-relations/Annual-report-banner/pdf/annual-report-2025.pdf
• Cahya Mata Sarawak Investor Relations page (all reports) https://www.cahyamata.com/investor-relations/
• Cahya Mata Sarawak Investor Relations – Annual Reports section https://www.cahyamata.com/investor-relations/reports/
• CMS Audited Financial Statements 2025 (Marketscreener) https://www.marketscreener.com/news/cahya-mata-sarawak-audited-financial-statements-2025-ce7f59ded08ef321
• KLSE Screener – CMSB Annual Report & CG Report 2025 https://www.klsescreener.com/v2/announcements/view/11557979

Phosphate Plant & Financial Performance Coverage

• Cahya Mata Sarawak posts lower FY2025 profit on Oiltools slump and Phosphates costs (EdgeProp, 24 Apr 2026) https://www.edgeprop.my/content/1915951/cahya-mata-sarawak-posts-lower-fy2025-profit-oiltools-slump-and-phosphates-costs-property-arm-surges-50-convention-centre-contract
• Cahya Mata's phosphate plant to break even in 3Q26 (Borneo Post) https://www.theborneopost.com/2025/12/24/cahya-matas-phosphate-plant-to-break-even-in-3q26/
• CMS phosphate plant set to hit profitability in Q3 FY26 (New Straits Times) https://www.nst.com.my/business/corporate/2025/12/1343550/cms-phosphate-plant-set-hit-profitability-q3-fy26
• Cahya Mata's phosphate plant is gradually ramping up (The Star, Dec 2025) https://www.thestar.com.my/business/business-news/2025/12/25/cahya-matas-phosphate-plant-gradually-ramping-up

Historical / Inheritance Context

• Taib Family At War Over Spoils From Sarawak (Sarawak Report archive) https://www.facebook.com/sarawakreport/posts/taib-family-at-war-over-spoils-from-sarawak-exclusivea-secret-court-hearing-this/640577158107166/
• In Malaysia, money squabbles cast a long shadow over the passing of Sarawak’s ex-governor Taib Mahmud (SCMP, Feb 2024) https://www.scmp.com/week-asia/people/article/3252714/malaysia-money-squabbles-cast-long-shadow-over-passing-sarawaks-ex-governor-taib-mahmud
• Taib Family At War Over Billions From Sarawak (The Coverage, Feb 2024) https://www.thecoverage.my/4067/taib-family-conflict-over-sarawak-billions
• The Taib Timber Mafia (Global Witness / Bruno Manser Fund 2012 report PDF) https://hornbillunleashed.files.wordpress.com/2012/09/bmf_taib_family_report_2012_09_19.pdf