KUALA LUMPUR (Sept 6): Shares in KNM Group Bhd emerged as the most actively traded on Bursa Malaysia in the morning session, after a group of shareholders sought to remove the company’s existing directors.
The counter rose 3.5 sen to a 15-month high of 13.5 sen, before paring some gains to still close up two sen or 20% at 12 sen per share at Wednesday's noon market break.
Trading volume stood at 437.58 million shares, more than 10 times the two-month average of 40 million shares.
Year to date, the stock had more than doubled from five sen on Dec 30, 2022.
On Tuesday, KNM received a notice from a group of shareholders, led by German businessman Andreas Heeschen, to remove its entire board of directors.
Heeschen, who emerged as a substantial shareholder with a 7.91% stake on Sept 1, is known as the majority owner of German-based firearms manufacturer Heckler & Koch.
Among others, the shareholders sought to appoint Johor princess Tunku Kamariah Aminah Maimunah lskandariah Binti Sultan Iskandar as a director to replace KNM chairman Tunku Datuk Yaacob Khyra.
Yaacob holds an 9.44% indirect stake or 347.2 million shares held via Melewar Industrial Group Bhd.
The group of shareholders also proposed to appoint another six new directors,, including Heeschen himself and Flavio Porro, a former executive director of KNM who exited the company back in December last year.
The shareholders want to hold an extraordinary general meeting to replace the directors.
KNM shares have underperformed since late last year, after the company fell into Practice Note 17 status, after it was unable to address its net current liabilities position in October 2022.
The plan was to slash its debt using proceeds from the disposal of its crown jewel, German-based machinery and equipment outfit Borsig GmbH.
However, KNM was unable to seal the deal for the sale of the company, which it bought back in 2008 for €350 million (RM1.75 billion). It now mulls the proposed listing of Borsig as an option, and has until Oct 31 this year to submit its regularisation plan to the exchange.
As of end-June this year, KNM’s borrowings stood at RM1.18 billion, down from RM1.26 billion a year earlier. The group had been loss-making for eight consecutive quarters. Its negative reserves stood at RM1.21 billion, up from RM1.16 billion the year before.