KUALA LUMPUR (Nov 15): Malaysian Bulk Carriers Bhd (Maybulk) has called off its plan to diversify into the grocery retail business, as conditions precedent of the relevant agreement had not been fulfilled by Monday (Nov 14), the cut-off date.
The dry bulk carrier operator had announced three months ago that it planned to invest RM54.38 million for the grocery foray via a collaboration with the operator of a retail chain under the Tunas Manja Group (TMG).
“Following the termination of the collaboration agreement and in view that the proposed collaboration, proposed diversification and proposed RRPT [recurrent related party transaction] mandate are inter-conditional, the company is unable to proceed with the proposals and accordingly, will not be seeking approval from its shareholders in relation to the proposals,” Maybulk said in a bourse filing on Tuesday (Nov 15).
The proposed diversification, aimed at mitigating the risk of overdependence on its existing shipping business, was deemed a related-party transaction as Tunas Manja is controlled by two substantial shareholders of Maybulk — Datuk Chin Yoke Kan and Datuk Chin Yoke Choon.
Yoke Kan and Yoke Choon had bought a 16% stake in Maybulk via Tunas Capital Sdn Bhd from tycoon Robert Kuok’s Pacific Carriers Ltd, which ceased to be a substantial shareholder of Maybulk in April. Subsequently, the duo were appointed directors of Maybulk.
But the key figure behind the grocery deal is Datuk Goh Cheng Huat, who acquired a 16% stake in Maybulk from Pacific Carriers as well. Also a new substantial shareholder, he is the executive director of Maybulk, The Edge Malaysia weekly reported in its Aug 22-Aug 28 edition.
Maybulk turned to profit in 2021 but has seen its fleet size shrink, following the sale of ageing vessels.
Over recent years, it had been loss-making, except for FY18 and FY21, when it posted a net profit of RM263.84 million and RM195.25 million, respectively.
The group posted a net loss of RM1.18 billion in FY15, RM491.31 million in FY16 and RM134.95 million in FY17. It also posted a net loss of RM7.32 million in FY19, before widening the loss to RM20.78 million in FY20.
Shares of Maybulk have slipped 27% year-to-date to close at 38.5 sen on Tuesday, valuing the group at RM385 million.