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[KUALA LUMPUR] Malaysia's debt-laden state fund 1MDB is set to sell two plots of land from a high-profile development project to a government-backed fund for about 700 million ringgit (US$200 million), two sources with direct knowledge of the matter said on Thursday.
The sale would be the first since 1MDB announced in February that it would dispose of assets to help cut its debt - a US$11.6 billion burden that has weighed on the ringgit and the country's sovereign credit rating.
1MDB, whose advisory board is chaired by Prime Minister Najib Razak, has been dogged by years of controversy over its management of funds and its huge debt.
Pilgrimage fund Lembaga Tabung Haji plans to purchase plots of land in the Tun Razak Exchange project, the sources said, declining to be identified as they were not authorised to speak publicly about the matter.
Tabung Haji said the fund will release a statement later on Thursday. A 1MDB spokesman declined to comment.
The Tun Razak Exchange, planned as a 70-acre financial centre within the capital, is one of two high-profile property projects in 1MDB's portfolio.
The Malaysian Reserve, a local newspaper, said on Thursday that Tabung Haji would buy about 5.03 acres for 772 million ringgit.