Prime Minister Anwar Ibrahim's move to file a RM200 million lawsuit against former prime minister Muhyiddin Yassin over the Felda debt waiver issue is baseless and undermines the court process, said Messrs Rosli Dahlan Saravana Partnership, the law firm that represented Muhyiddin.

In response to a letter sent from Anwar through the law firm Messrs SN Nair & Partners, the firm described the prime minister's action as an attempt to "twist" the matter.

"You should know that your client's demand for RM200,000,000 is baseless and, if filed, constitutes an abuse and manipulation of the court process," it said in a letter to Anwar's lawyer.

On Friday, Anwar demanded that Muhyiddin apologise and pay RM200 million in compensation for damaging his reputation over the issue of Felda settlers' debt disposal.

In response to Muhyiddin's letter of demand earlier, Anwar said that he would commence legal action against him if no satisfactory response is received within 24 hours from the date of the response letter.

The response letter was addressed to Messrs Rosli Dahlan Saravana Partnership.

Anwar also demanded that Muhyiddin retract his letter of demand and all defamatory statements published about the issue in general.

On Wednesday, Muhyiddin demanded that Anwar prove he had signed the Felda settlers' debt disposal agreement worth RM8.3 billion. The Pagoh MP also requested that Anwar retract his claim of not resolving the issue and apologise to him.

The government led by Muhyiddin initiated steps to eliminate settlers' debts in June 2020. The agreement was approved by the Cabinet four months later.

It includes a government guarantee of RM9.9 billion to Felda to restructure the agency's loans through the issuance of sukuk.

In February, the government announced that it was unable to continue to waive the Felda settlers' loans as announced by Muhyiddin.

Minister in the Prime Minister's Department (Law and Institutional Reform) Azalina Othman Said said that the waiver of loans has had a significant impact on Felda's cash flow.