Armed Forces Pension Fund (LTAT) chief executive officer Ahmad Nazim Abdul Rahman said Boustead Naval Shipyard Sdn Bhd (BNS) was forced to use part of the funds meant for the littoral combat ships’ (LCS) procurement to pay off the bad debts of another old project.

This is because Boustead Holdings Bhd - whose biggest shareholder is LTAT - was compelled at one point to take over the debt-ridden PSC Industries Bhd, a company that failed to deliver on an RM9 billion contract to build six offshore patrol vessels (OPVs).

“After the failure of the...