Serba Dinamik continues share price fall, with KPower and SCIB also in the red

Tuesday 17 Dec 2024

KUALA LUMPUR (June 24): Shares in Serba Dinamik Holdings Bhd continued their downward spiral today in Bursa Malaysia morning trade, two days after the group announced that its board had decided to take legal action against its external auditor KPMG PLT.

At the time of writing, Serba Dinamik’s share price had fallen 3.5 sen or 5.04% to 56 sen apiece, valuing the company at RM2.07 billion based on its market capitalisation.

The counter had so far seen 81.76 million shares traded, making it the second most active stock on Bursa this morning, behind information and communications technology (ICT) solutions provider MMAG Holdings Bhd.

Since the audit issues of the firm were made public at the end of May, the counter had lost about 65.2%, with over RM3 billion market capitalisation wiped off.

Meanwhile, counters linked to Serba Dinamik group managing director and chief executive officer (CEO) Datuk Dr Mohd Abdul Karim Abdullah were also feeling the heat.

Both KPower Bhd and Sarawak Consolidated Industries Bhd (SCIB) were also in the red this morning. At the time of writing, KPower had slid 5.5 sen or 5.64% to 92 sen, while SCIB was down three sen or 4% to 72 sen.

Mohd Abdul Karim, who is the largest shareholder of Serba Dinamik, is controlling a 27.07% stake in the oil and gas (O&G) firm. He also holds a 32.36% stake in KPower and 36.8% of SCIB.

Following the announcement that Serba Dinamik is taking legal action against KPMG on Tuesday, the Securities Commission Malaysia (SC) and Bursa both came out yesterday to deny that they had spoken with the group's chairman Datuk Mohamed Ilyas Pakeer Mohamed.

The SC also said that auditors are required by law to report to the SC if it finds any material issues, or if there are any potential breach of securities laws and rules of the stock exchange.

"Auditors should be allowed to carry out their responsibilities and render their independent opinion without fear or favour, and discharge their duties free from any retaliation,” it said yesterday.

In a separate statement, Bursa Malaysia also reiterated that it is “imperative” that Serba Dinamik appoints an independent reviewer to address the uncertainty and provide clarity to the market.

On Tuesday, Mohamed Ilyas, who was appointed to Serba Dinamik’s board of directors earlier on June 11, claimed at a virtual press conference that the external auditor “had blown the audit issues out of proportion".

He also said that he had spoken to the SC and Bursa.

At the press conference, it was also revealed that Serba Dinamik’s board had decided to take legal action against KPMG, alleging that the audit firm had been negligent and breached its contractual and statutory duties to the group.

KPMG, meanwhile, said that it sees no basis for the legal action taken by Serba Dinamik.

Serba Dinamik has been embroiled in the auditing dispute with KPMG after the auditor highlighted discrepancies involving transactions to the tune of over RM4 billion.

Edited ByJoyce Goh

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