KUALA LUMPUR: Datuk Seri Santhara Kumar a/l Ramanaidu, the single largest shareholder of Masterskill Education Group Bhd who resigned from all executive positions yesterday, is said to be taking it easy due to health reasons.
Better known as Edmund Santhara, he has been known to be working “overtime” to turn around the company since it posted a net loss of RM28.3 million for the 2012 financial year ended Dec 31 (FY12).
The education group, which focuses on nursing courses, attributed the FY12 loss to lower student enrolment as a result of the reduction in PTPTN loan amount and higher entry requirements for the nursing programme.
Masterskill’s financial troubles began to show in FY11 when its net profit was reduced substantially to RM38.14 million from RM102.14 million in FY10 on weak student intake and higher than expected staff costs.
It saw a 35% drop in student intake to 3,500 in FY11, against 14,000 in FY10. For the second half of FY11, only 250 students enrolled at the nursing college.
Edmund initiated several moves to ensure MEGB’s survival. Among them was adopting an asset-light strategy by hiving off some of its properties and using the proceeds to settle the company’s outstanding debt of RM68.27 million as at the end of December 2012.
As at the end of last year, the company’s balance sheet showed some RM361.96 million in property, plant and equipment, while RM10.1 million was categorised as assets available for sale investments. However, the company has not announced any asset sales to date.
The education group is also shifting away from its niche focus of nursing courses and diversifying into humanities, business, tourism and hospitality courses in order to boost enrolment.
A significant milestone in achieving this new direction was the change in name of the educational institution from Asean
Metropolitan University College to ASIA Metropolitan University last year. The name change and upgrade to a full university status were approved by the ministry of higher education on Oct 11 and Oct 12, 2012 respectively.
“After steering Asia Metropolitan University onto new horizons by opening up various new and exciting options in the education industry and achieving the full university status, it is time for Edmund Santhara to pursue other interests and be an active citizen,” MGEB said in its announcement to Bursa Malaysia on the resignation of Edmund as CEO.
Market rumour has it that Edmund is interested to venture into politics. At the age of 42, Edmund is said to have ample time to make his name in the political scene, while leaving the day-to-day running of MEGB to its newly appointed executive director Siva Kumar a/l M Jeyapalan.
The second biggest shareholder of MEGB with a direct stake of 12.2% stake, Siva Kumar is expected to make a slew of changes especially in working up the group’s assets.
Siva Kumar, 42, has begun accumulating his stakes in MEGB since October 2011. A former director of MEGB, he is an engineer by profession and had worked with Accenture as an analyst from 1994 to 1996.
He later joined the corporate finance department of AmInvestment Bank Bhd. Currently, he is a director of his family-owned company which is a substantial shareholder of serveral private and public companies.
MEGB shares closed at 57.5 sen yesterday, a far cry from RM1.17 a year ago and RM4.25 in August 2010.
This article first appeared in The Edge Financial Daily, on April 18, 2013.