Friday 14 Jun 2024
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KUALA LUMPUR (March 12): South Malaysia Industries Bhd (SMI) is seeing signs of renewed clashes between two groups of shareholders seeking to take control of the company in its upcoming annual general meeting (AGM) scheduled on March 27.

It appears that Techbase Industries Bhd, formerly Prolexus Bhd, is making another attempt to take control of SMI boardroom at the upcoming shareholders’ meeting.

According to SMI stock exchange filing on Tuesday (March 12), Techbase’s wholly owned unit Honsin Apparel Sdn Bhd has expressed intention to appoint Hong Zheng Hong and Tan Eng Gooi as directors in the AGM.

Honsin owns a 7.5% direct stake in SMI as at Oct 12 last year, according to the latter’ annual report.

SMI also disclosed that Chong Fu Shen has expressed intention to appoint himself, Lum U-Jun, Chong Fu Chih and Loo Choo Hong as directors in the upcoming AGM.

Chong is listed amongst the 30 largest shareholders in SMI, with a 0.7% interest.

SMI said its board of directors will convene an emergency board meeting next Monday (March 18) and seek legal advice on these two notices from Honsin and Fu Shen.

Honsin had sought to remove SMI’s board of directors last year through an extraordinary general meeting (EGM), which did not materialise as both parties were subsequently embroiled in a series of legal battle.

Honsin had deemed that its rights as shareholders were violated as its request to convene an EGM was allegedly blocked, while SMI filed a complaint to the Securities Commission of Malaysia, alleging that people acting in concert with Honsin collectively took control of over 33% of the company's shareholdings without making a mandatory takeover offer.

The company has not provided any update on the matter.

In December last year, Honsin and Techbase’s 51.91%-owned unit HIQ Media (M) Sdn Bhd sued SMI and its board of directors for allegedly violating their rights as shareholders after SMI sought for more time to hold its AGM.

The suit was filed after the Companies Commission of Malaysia (CCM) granted SMI until March 31, 2024 to hold its 52nd AGM, from the previous cut-off date of Dec 31, 2023, following an application from SMI to extend the deadline.

These lawsuits are still ongoing.

SMI’s largest shareholder is Asian PAC Holdings Bhd, which owns a 2.25% direct stake and 9.3% indirect shareholdings. Mah Sau Cheong, who is Asian PAC’s single-largest shareholder with 32% stake, also owns 7.65% direct interest in SMI.

Shares of SMI were last traded on Monday (March 11) at 58.5 sen, giving it a market capitalisation of RM122.81 million.
 

Edited ByLee Weng Khuen
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