Malaysia's Maxis seeks $3.4B in SE Asia's top IPO

10/28/2009, 4:59 a.m. EDT
EILEEN NG
The Associated Press

(AP) — KUALA LUMPUR, Malaysia - The mobile phone empire of Malaysian billionaire Ananda Krishnan launched an initial public offering Wednesday to raise at least $3.4 billion in the biggest share sale in Southeast Asia.

Maxis Berhad, the top mobile company in Malaysia, is offering for sale 2.25 billion existing shares, representing 30 percent of its total equity, it said in a prospectus. The indicative price of 5.20 ringgit ($1.50) a share would raise 11.7 billion ringgit in total.

Of the 30 percent stake, only 2.83 percent will be offered to retail investors while the rest will be sold to local and foreign institutional investors, the company said.

The share sale marks the return of Maxis to the Malaysian bourse two years after it was taken private in 2007 by tycoon Ananda Krishnan-the world's 62nd richest individual, according to Forbes. Its relisting followed a request by Prime Minister Najib Razak who is seeking to bolster Malaysia's capital markets.

"It was envisaged that the relisting of Maxis would attract the attention of local and regional investors, enlarge Bursa Malaysia's market capitalization and also add to the range of large, well managed companies available on our stock market," said Maxis chairman Raja Arshad Tun Uda.

Maxis, however, is listing only its domestic operations-a move some analysts said may make the IPO less attractive as it excluded its fast growing businesses in India and Indonesia.

Nazir Razak, chief executive of CIMB Group which is the adviser for the IPO, said Maxis would be the fourth largest company with a market capitalization of 39 billion ringgit ($11.5 billion) when it is listed Nov. 19.

He said the IPO was the largest ever in Southeast Asia.

Maxis enjoys a 40 percent share in the domestic mobile market, allowing investors to participate in its steady revenue without risks from its international ventures, he said.

Four major investors including Fidelity-the world's biggest mutual fund company, and Malaysia's Employees Provident Fund-have committed to buy 28 percent of the IPO, and are not allowed to sell the shares within six months, he said.

The prospectus said Maxis plans to pay an annual dividend of at least 75 percent of its profit. The sale price for the IPO shares will be finalized when the offer closes Nov. 10.

Despite a lower demand for IPOs in the region, Nazir voiced confidence in the success of Maxis share sale, citing the company's strong track record and good growth prospects in the Malaysian market.

South Korea's Posco Engineering and Construction recently canceled its planned share offering while China-based developer Evergrande has sharply cut its fund-raising target by nearly 61 percent for its IPO in Hong Kong.
© 2009 Associated Press. All Rights Reserved.

Morning Prayers: More Misery to Come as Sentiment Splits

* October 28, 2009, 4:02 AM ET

By Lauren Mills

It looks like there’s more misery to come today. Despite a flurry of healthy third quarter results from big hitters like GSK, BG Group and BAT, European markets are expected to start the session weaker.

David Buik, a partner at BGC Partners expects the FTSE to open down 20 points. “I think the market will bounce around like a cork in a bath. But you can’t expect it to keep gaining when it has already gained 56% since March 9. We can’t expect it to keep rallying unless news is exceptional.”

Buik believes investors have split into two groups: those who want to stick with equities in the hope that third quarter earnings will be good. And those who pile into the relative safety of gilts.

And this could mean gilts open slightly higher today.

There are concerns today as the EU is set to give permission to Northern Rock to split into good bank/ bad bank.

“I think this shows the banking market is getting fragmented. And it gives the likes of Tesco and Virgin Money the opportunity to come in to buy branches from Northern Rock,” says Buik.

The view is that others such as Lloyds and RBS will also be told to cut down the size of their balance sheets, so they too will be required to sell off branches. All this means continued uncertainty hangs over UK banking stocks.

And here’s more evidence of the market’s split personality.

Carpetright’s excellent trading update, for the 12 weeks to 24 October 2009, showed group sales had increased by 10.3%. And sales in the UK and Republic of Ireland rose by 12.2%, with like-for-like sales up an impressive 5.6%.

This has prompted analysts at KBC Peel Hunt to upgrade forecasts by 11% for 2010 and 25% for 2011.

Analysts at KBC are cheered by the carpet retailer’s performance as it tends to be an early indicator of economic recovery.

But just as your hopes are raised, yes, you’re right, they’re going to be slapped down again.

Disappointing results from US business software firm SAP could have a negative impact on UK rivals such as Logica and Sage.

A Rivalry as Strained as New Jersey’s Finances

Photographs by Richard Perry/The New York Times

The Democratic governor of New Jersey, Jon S. Corzine, right, and his Republican challenger, Christopher J. Christie, have made it clear that they share little mutual respect or admiration.

By DAVID M. HALBFINGER and DAVID KOCIENIEWSKI
Published: October 29, 2009

(page 1 of 2)

In the final leg of New Jersey’s unpredictable governor’s race, both candidates are casting about for ways to save the state from financial doom as they confront the economic reality that will severely restrict the winner of Tuesday’s voting.

The Democratic governor, Jon S. Corzine, says he may revisit his plan to lease the New Jersey Turnpike to raise cash — a proposal that he abandoned last year in the face of intense opposition from lawmakers and voters.

His Republican challenger, Christopher J. Christie, retreating from a key campaign promise, says he can no longer fully restore property tax breaks for homeowners, given the uncertainty of the state’s finances.

In separate interviews in recent days with The New York Times, the two rivals made no apologies for the ugly tone of the campaign, offered markedly different visions for how to shape the state’s highest court, complained about their depictions in each other’s commercials, and made it clear that they shared little mutual respect or admiration.

Mr. Corzine said he rued having supported Mr. Christie’s nomination for United States attorney when he was a senator because, he contended, Mr. Christie politicized the job and used it as a launching pad. “New information, new conclusion,” he said.

Mr. Christie, somewhat theatrically, struggled for several moments to name three things the governor had done right. “Let me think,” he said. “Um ... I would probably say I think over all his prosecutorial appointments have been good.”

Mr. Corzine seemed almost resentful that he was not more appreciated by voters or the news media, citing unsung accomplishments like the passage of a civil unions law, paid family leave and the abolition of the death penalty.

“It’s like in the water that somehow or another we didn’t do some of these things,” he said, adding: “Go through the record. May not be pretty, but we got it done.”

Mr. Corzine and Mr. Christie have been battling for nearly 10 months in an expensive and sometimes personal contest that has attracted national interest; the nation’s only other governor’s race is in Virginia . Mr. Corzine is ahead in some polls and Mr. Christie in others, though many voters say they still may change their minds. A third-party candidate, Christopher J. Daggett, is far behind but could help tip the race in either direction.

With 39 governor’s races in 2010, the outcome in New Jersey may hold a lesson about campaigning during hard times: whether it is better to play down the trouble one’s state has fallen into, or to soft-sell the pain it will take to emerge from it.

Mr. Corzine accuses Mr. Christie of falsely claiming that jobs and residents have fled the state and says the news media have unfairly portrayed New Jersey as “worse than other places.” He ticks off positive indicators: rising median incomes, falling numbers of the uninsured and rising test scores. “There are a lot of good things,” he said.

Yet, he acknowledged the obvious: “There’s a lot of people hurting out here,” he said. “A lot of people who didn’t expect to be hurting.”

He added, “I’m empathetic with that.”

Mr. Christie, who says New Jersey is caught in “negative momentum” economically, focuses almost exclusively on the state’s strapped middle class, pledging to force concessions from state employee unions and to bring “parental supervision” to an overspending Legislature, without ever precisely saying how.

“I think it’s being responsible,” he says about his lack of specifics. “I’m not setting up expectations that I can’t meet.”

Regarding property tax rebates, Mr. Christie now says he cannot fully restore them — though his commercials omit this qualifier — and that he will send back the money only “on a sliding scale depending on what the economic conditions were.” He explained the turnabout by saying he was “prioritizing out of a set of bad choices.”

Referring to looming deficits, he added, “It’s not like I can click my heels and say, ‘Make the bad stuff go away.’ ”

The change is one of several recent reversals. Mr. Christie now also disavows a promise, made in a primary-season debate, to roll back a sales tax increase. He has backed away from a pledge to avoid using “one-shot” revenues to close the budget deficit. And he is now deferring until later in his term plans to eliminate a business tax surcharge, cut income taxes across the board, identify a permanent financing source for open-space preservation and restore higher-education financing to 2002 levels.

His biggest surviving pledge is to roll back Mr. Corzine’s tax increase on people making more than $400,000 a year.

While Mr. Corzine wears his spending priorities on his sleeve — education and the social “safety net” — Mr. Christie’s are more difficult to pin down.

A Rivalry as Strained as New Jersey’s Finances

Published: October 29, 2009

(Page 2 of 2)

An estimated $8 billion budget deficit looms next year, and his tax cuts and rebates could expand that, but Mr. Christie now says he will largely follow the governor’s lead in closing the gap: saving $2 billion by deferring pension contributions and reaping a hoped-for $2 billion in additional federal stimulus aid. Mr. Christie pencils in $1.5 billion more in concessions from state workers — which would be little short of a miracle — and $500 million from forgoing increases in education financing.

The rest, some $3 billion, will have to come from “programmatic cuts,” Mr. Christie said. “I think everything else would be on the table,” he said.

If Mr. Christie has been forced to jettison his grand plans, Mr. Corzine does not seem to have any. After campaigning in 2005 on a bold — and unfulfilled — promise to cut property taxes 40 percent, he now says the state cannot afford any big-picture ideas, and could not name a high-profile issue that he would make the hallmark of his second term.

“We’ve been prepared to come up with more outside-of-the-box ideas, and we’ll come up with more,” he said. “But in the seeds of this there are unattractive alternatives.”

Mr. Corzine’s most ambitious effort, a plan to pay down debt by selling the New Jersey Turnpike, died in the Democratic-run Legislature in 2008. Now he calls the idea “too big, too fast, at the wrong time” and says state residents, already sensing the coming recession, were unwilling to accept the toll increases it would entail.

“This idea worked,” the governor said, adding, “So maybe we just need to scale it back.”

Absent a roaring recovery, Mr. Corzine says he would “service the most vulnerable as resources will allow,” continuing to support food banks, legal services and children’s health, while investing in economic engines like infrastructure, stem-cell research and so-called green energy efforts like offshore wind farms.

If money rolls in, he would weigh restoring property tax rebates, providing money to meet pension obligations, restructuring state debt and expanding prekindergarten.

Mr. Corzine also hints that he might reduce the state’s 4 percent cap on local property tax increases, both to spare homeowners and to spur municipal consolidations.

As the two men reflected on the long campaign, Mr. Christie admitted that calling prekindergarten “baby-sitting,” as he did early this year, “probably wasn’t the best choice of words.” But Mr. Corzine offered no apology for his attacks on Mr. Christie’s character, saying he had merely given as good as he got. “I don’t know what you’re supposed to do — sit here and just get crushed?” he said.

They offered competing views on the essence of the election: Mr. Christie characterized it as a contest between the Democratic incumbent’s expansionist government and his more modest approach, that would tend mainly to the basics: health, safety and welfare.

Mr. Corzine boiled the race down to coming vacancies on the State Supreme Court. Four of the seven justices are scheduled to be replaced or reappointed in the next four years, and Mr. Corzine said that the wrong replacements could imperil liberal causes like abortion rights, labor and affirmative action. Mr. Christie wants judges who he says will not legislate from the bench.

And they shared their views of leadership, with Mr. Corzine defending his sometimes diffuse style, which often leaves even his supporters puzzled about what direction he’s leading them, calling if the proper role of an energetic chief executive. “Why would you want to be governor, or why would you want to be a leader, and not address the issues that exist?” he said.

In a lengthy discourse on the use of power, Mr. Christie said that strong leadership requires clear communication and straightforward negotiation — much like, say, a prosecutor plea-bargaining with a defense lawyer.

“Don’t make empty threats and don’t make empty promises,” Mr. Christie said. “Leadership is about perception, too,” he said. “You’ve always got to keep that in mind.”

Iran nuclear talks 'going slowly'

Mohamed ElBaradei said the talks will continue on Wednesday morning

Talks between Iran and world powers on a uranium enrichment deal are making slower-than-expected progress, the head of the UN's nuclear watchdog has said.

Mohamed ElBaradei said "many technical issues" had to be analysed, but insisted they were "moving forward".

The negotiations were stalled for most of Tuesday after Iran said it did not want France to be part of the deal, but briefly resumed late in the evening.

Iran is considering a proposal to send uranium abroad for further enrichment.

This is seen as a way for Iran to get the fuel it needs, while giving guarantees to the West that it will not be used for nuclear weapons.

'Complex process'

Tuesday's talks in Vienna - involving Iran and three of the five permanent members of the UN Security Council, as well as the International Atomic Energy Agency - faltered after the Iranians said they would curb enrichment, something seen by the Western powers as essential, and objected to France's involvement.

All sides eventually returned to the negotiating table for about an hour after the US and Iranian representatives met in Mr ElBaradei's office. Few details of the meetings were released.

Mr ElBaradei, director general of the IAEA, said the talks would resume at 1000 (0800 GMT) on Wednesday.

"I believe we are making progress. It is maybe slower than I expected. But we are moving forward," he told reporters.

He said the process was complex, and involved "many technical issues" as well as "confidence-building guarantees".

The Iranian ambassador to the IAEA, Ali Asghar Soltanieh, meanwhile said the consultations had been "constructive".


A satellite image of what analysts believe is the facility at Qom

Q&A: Iran and the nuclear issue
Guide: Nuclear fuel cycle

Earlier, Iran's Foreign Minister, Manouchehr Mottaki, objected to Paris being part of the enrichment deal because it had reneged on nuclear fuel contracts in the past.

"There is Russia, America... I believe these countries are enough," he said.

"France, based on its shortcomings to fulfil its obligations in the past, is not a trustworthy party to provide fuel for Iran."

Mr Mottaki also reiterated any agreement would not mean the suspension of Tehran's enrichment activities.

"Iran will continue its uranium enrichment. It is not linked to buying fuel from abroad," he said.

"The meetings with world powers, and their behaviour, shows that Iran's right to have peaceful nuclear technology has been accepted by them."

Compromise

The proposed scheme hinges on an arrangement in principle that Western negotiators announced after talks in Geneva earlier this month.

Under it, Russia and France would treat most of Iran's low-enriched uranium and turn it into fuel rods for a research reactor in Tehran.

Diplomats say a compromise is being considered under which Iran would sign a contract with Russia, which would then sub-contract work to France.

Correspondents say the deal would see Iran get the fuel it needs, tacit acknowledgement of its right to enrich uranium, and no new sanctions.

The West would meanwhile get a guarantee that Iran's existing stockpile will not be diverted to make nuclear bombs, they add.

Last month, the revelation of a second uranium enrichment plant in Iran further raised Western fears that Iran was trying to develop nuclear weapons. A nuclear bomb requires highly enriched uranium.

The Iranian government has said it will allow IAEA inspectors into the site, thought to be near the holy city of Qom.

With New Afghan Vote, Path to Stability Is Unclear

President Hamid Karzai of Afghanistan with Senator John Kerry at a news conference in Kabul on Tuesday.

By SABRINA TAVERNISE, MARK LANDLER and HELENE COOPER
Published: October 20, 2009

This article is by Sabrina Tavernise, Mark Landler and Helene Cooper.

KABUL, Afghanistan — President Hamid Karzai’s concession of the need for a runoff election in Afghanistan appears to have prevented his country from slipping into paralysis, but has created a new landscape of risks and uncertainty.

Mr. Karzai’s concession was a critical first step toward creating a credible Afghan government, coming after heavy pressure from European and American officials, including veiled threats that his actions could affect pending decisions about troops levels, according to one American official who spoke on condition of anonymity because of the delicacy of the matter.

But diplomats immediately questioned whether a new vote could be arranged before the announced date of Nov. 7, and whether a second round of balloting would have more security or less fraud than the first, in which nearly a quarter of ballots were thrown out by international auditors. “There are huge constraints to delivering in the second round,” said one Western official. “Can you deliver a result that is any different from the one we’ve already got?”

The host of uncertainties left open the prospect of what administration officials and their Western allies expect will be three weeks of ferocious horse-trading as Mr. Karzai and his principal challenger, Abdullah Abdullah, decide whether they can strike a deal to actually avert a runoff, which would carry enormous political risks for both of them, as well as strategic ones for the United States and its allies.

Diplomats said the efforts to get the two men to join forces would now intensify. Mr. Abdullah has hinted he would be open to negotiate, but Mr. Karzai, at a news conference here on Tuesday, seemed to rule it out.

“The coalition has no legitimacy and is not possible,” he said, standing alongside Senator John Kerry, Democrat of Massachusetts and chairman of the Foreign Relations Committee, who negotiated with Mr. Karzai for nearly 20 hours over 5 days to accept the results.

Yet officials said that if there was a deal it would likely involve Mr. Abdullah conceding to Mr. Karzai, in return for a major role in overhauling Afghanistan’s Constitution to give the president less power.

Afghanistan’s Independent Election Commission formally certified the vote Tuesday, and said Mr. Karzai had received 49.7 percent of the votes, higher than a foreign-led panel of experts conducting the audit had found, but still below the over 50 percent required to avoid a runoff.

Mr. Karzai seemed to dismiss any fraud, saying of the disqualified votes: “The voters are not to blame. Why their votes were disrespected, should be thoroughly investigated. But it is not the right time to discuss this.”

While some see a deal between Mr. Karzai and Mr. Abdullah as a way to create a credible Afghan government with broader popular support, many in the Obama administration express concerns that it would only make the running of Afghanistan more chaotic, given the enmities between the two.

After Mr. Karzai’s complaints of foreign interference, the administration is also determined not to appear to meddle.

“We feel very strongly about this,” said one of President Obama’s closest foreign policy advisers, who spoke on condition of anonymity. “We had a big stake in making sure we had a legitimate election. But this is up to the Afghans.”

As it became clear that international auditors would invalidate enough votes to push Mr. Karzai below the threshold for a runoff, the American efforts to convince the president that he had not won the election outright were extraordinary.

The task was left to Mr. Kerry and Secretary of State Hillary Rodham Clinton, who have experienced their own frustration at the polls, and used those scars in dealing with Mr. Karzai.

In one personal moment during a weekend of long dinners and walks in the garden of the sprawling, heavily fortified presidential palace in Kabul, Senator Kerry recounted his experience in the 2004 presidential election, including the lingering questions about ballots cast in Ohio that helped decide the vote against him.

“I told him, ‘sometimes there are tough things,’ ” Mr. Kerry said in an interview on Tuesday.

A senior administration official described the international pressure on Mr. Karzai as a “full court press” that also included not-so-subtle threats delivered by telephone to Mr. Karzai’s defense minister, Gen. Abdul Rahim Wardak.

Gen. James L. Jones, the national security adviser, and Defense Secretary Robert M. Gates both called General Wardak to press him to persuade Mr. Karzai to concede, a senior administration official said.

“Wardak wants more American troops,” said this official, speaking on condition of anonymity because he was discussing private conversations. “They both told Wardak that this would affect the decision-making process on the troops.”

At times Obama administration officials seemed at odds over how to deal with Mr. Karzai’s recalcitrance. On Sunday, the White House chief of staff, Rahm Emanuel, said Mr. Obama would not make a decision on troops until the political uncertainty in Afghanistan had lifted. On Tuesday, Mr. Gates said the United States could not wait for that.

Sensing last week that a crisis was brewing in Kabul and would coincide with a visit there by Mr. Kerry, Mrs. Clinton dispatched Richard C. Holbrooke, the special representative for Afghanistan and Pakistan, to the senator’s Georgetown townhouse to brief him about the situation and ask for his help.

On Friday evening, when Mr. Kerry was dining in Kabul with American troops, the United States ambassador, Lt. Gen. Karl W. Eikenberry, warned him that Mr. Karzai was threatening to denounce the election audit.

Alarmed that this would plunge Afghanistan into paralysis, General Eikenberry asked Mr. Kerry to go to the palace that night. By Senator Kerry’s account, what followed were a series of meetings over the next four days.

“We worked through the risks, we worked through the stakes,” Mr. Kerry said by phone from Dubai, on his way back to Washington. “He was patient, he was searching for answers.”

Mrs. Clinton also spoke to Mr. Karzai for 40 minutes on Friday, during which he complained he could never be a legitimate leader if the ballots of 1.3 million of his Pashtun supporters were disqualified. Mrs. Clinton, no stranger to bitter disappointment at the polls, told him she sympathized with his plight, according to officials with knowledge of the conversation.

But she argued that if Mr. Karzai ran in a runoff and prevailed, which she and other American officials believe he would, that would be the surest way for him to claim legitimacy.

Prime Minister Gordon Brown spoke with Mr. Karzai three times, European diplomats said, adding his voice to the pressure. “He made clear that Karzai just had to accept” the results of the international election commission, one diplomat said, or he “would no longer be a partner of the West.”

Sabrina Tavernise reported from Kabul, and Mark Landler and Helene Cooper from Washington. Thom Shanker contributed reporting from Tokyo, and Abdul Waheed Wafa from Kabul.

U.S. Won’t Prosecute in States That Allow Medical Marijuana

By DAVID STOUT and SOLOMON MOORE
Published: October 19, 2009

WASHINGTON — People who use marijuana for medical purposes and those who distribute it to them should not face federal prosecution, provided they act according to state law, the Justice Department said Monday in a directive with far-reaching political and legal implications.

In a memorandum to federal prosecutors in the 14 states that make some allowance for the use of marijuana for medical purposes, the department said that it was committed to the “efficient and rational use” of its resources and that prosecuting patients and distributors who are in “clear and unambiguous compliance” with state laws did not meet that standard.

The new stance was hardly an enthusiastic embrace of medical marijuana, or the laws that allow it in some states, but signaled clearly that the administration thought there were more important priorities for prosecutors.

“It will not be a priority to use federal resources to prosecute patients with serious illnesses or their caregivers who are complying with state laws on medical marijuana,” Attorney General Eric H. Holder Jr. said in a statement accompanying the memo, “but we will not tolerate drug traffickers who hide behind claims of compliance with state law to mask activities that are clearly illegal.”

Emphasizing that it would continue to pursue those who use the concept of medical marijuana as a ruse, the department said, “Marijuana distribution in the United States remains the single largest source of revenue for the Mexican cartels,” and pursuing the makers and sellers of illegal drugs, including marijuana, will remain a “core priority.”

The new policy was tbe laszThe politics swirling around marijuana cross ideological lines. For instance, in effectively deferring to the states on some issues involving marijuana, the Obama administration is taking what could be seen as a states’ rights stance, more commonly associated with conservatives. That was a theme that echoed on many conservative and libertarian Internet sites in the wake of Monday’s announcement.

But one prominent conservative, Representative Lamar Smith of Texas, criticized the Justice Department’s position, saying it would weaken federal enforcement of drug laws.

“By directing federal law enforcement officers to ignore federal drug laws, the administration is tacitly condoning the use of marijuana in the United States,” said Mr. Smith, the senior Republican on the House Judiciary Committee. “If we want to win the war on drugs, federal prosecutors have a responsibility to investigate and prosecute all medical marijuana dispensaries and not just those that are merely fronts for illegal marijuana distribution.”

Polls have shown for years that there is widespread public support for making marijuana available to relieve the suffering of people who are very ill. But repeated efforts in Congress to block federal prosecution of medical marijuana have fallen short, and the new policy was a sharp departure from that of the Bush administration, in which the Drug Enforcement Administration raided medical marijuana distributors even if the distributors appeared to be complying with state laws.

The new policy, which reflects positions that Mr. Obama took as a presidential candidate and that Mr. Holder laid out in March, came in a memo from David W. Ogden, the deputy attorney general, to the United States attorneys in the affected states, most notably California.

The White House sought to turn aside any impression that Mr. Obama would like other states to follow the example of the 14 that make some allowance for medical marijuana.

“I’m not going to get into what states should do,” said the president’s chief spokesman, Robert Gibbs.

Mr. Gibbs said the memo to federal prosecutors “simply adds guidelines to a decision that Attorney General Holder talked about in mid-March and has been administration policy since the beginning of this administration in January.”

The guidelines give specific examples of conduct that would causes prosecutors to look at a case involving marijuana even if a user or distributor said it was for medical use. The examples include unlawful possession or use of a firearm, sales to minors and evidence of money laundering activity.

Graham Boyd, director of the Drug Law Reform Project at the American Civil Liberties Union, called the Justice Department’s move “an enormous step in the right direction and, no doubt, a great relief to the thousands of Americans who benefit from the medical use of marijuana.”

Mr. Boyd predicted that states and cities “will have a strong incentive to create regulated, safe and sensible means of getting marijuana to patients who need it.”

The new policy follows a series of changes, including the appointment of Richard Gil Kerlikowske, a former police chief of Seattle, to be Mr. Obama’s top drug policy adviser.

Medical marijuana thrived in Seattle on Mr. Kerlikowske’s watch, and advocates of more liberal marijuana laws hoped that his appointment to the office, which he assumed in May, signaled the administration’s willingness to decriminalize medical marijuana.

Some federal law enforcement officials are opposed to the administration’s position.

Privately, some federal law enforcement officials complained that medical marijuana and marijuana being smuggled in from Mexico are one and the same, and that the Obama administration has backed away from necessary enforcement of drug laws. Agents from the D.E.A. often work alongside local police officers.

As Mr. Ogden’s memo was being made public, the Web site of the Drug Enforcement Administration outlined its position on medical marijuana: “Smoked marijuana has not withstood the rigors of science — it is not medicine and it is not safe. D.E.A. targets criminals engaged in cultivation and trafficking, not the sick and dying.”

Advocates of medical marijuana say it can reduce chronic pain, nausea and additional symptoms associated with cancer and other serious illnesses. In 1996, California became the first state to make it legal to sell marijuana to people with doctors’ prescriptions. The other states that allow some use of marijuana for medical purposes are Alaska, Colorado, Hawaii, Maine, Maryland, Michigan, Montana, Nevada, New Mexico, Oregon, Rhode Island, Vermont and Washington.

Solomon Moore contributed reporting from Los Angeles.