KUALA LUMPUR (Oct 23): A group of investors and creditors led by a businesswoman have applied to the High Court here for a stay of a court mandated meeting for ACE Credit Sdn Bhd, a subsidiary of ACE Holdings Bhd.
Following a case management, the parties will appear to brief the court on Thursday, and the hearing for their stay application against the court-convened meeting will be heard on Oct 29 before High Court Judicial Commissioner Saheran Suhendran @ Sockanathan Abdullah.
The businesswoman, Che Normah Che Kerma, together with other applicants who are unsecured creditors filed the notice of motion dated Oct 18 through Messrs Wan Sarimah & Co. The firm confirmed the case management and hearing dates to The Edge.
Che Normah, who affirmed the affidavit in support of the motion seeking a stay of the court-convened meeting scheduled to be held on Oct 30, had already obtained a final judgement against ACE Credit on July 21 in 2023 which was not appealed.
The summary judgement against ACE Credit directors Datuk Choong Chee Meng and Chang Ai Nee was for breach of an investment agreement following an investment of RM2 million.
Apart from seeking a stay of the court-convened meeting until the disposal of their application, they also sought the liquidators for ACE Credit to provide the following documents:
- evidence of indebtedness by related company that is ACE Holdings in ACE Credit amounting to RM796.880 million
- evidence of indebtedness of Ace Investment Bank Ltd with ACE Credit amounting to RM15.365 million
- a copy of the portfolio sales and purchase agreement dated Nov 9, 2023 entered between ACE Credit with General Reserve of Digital Assets Ltd
- bank statements showing transactions between ACE Credit with ACE Holdings and ACE Investment Bank.
If the liquidators fail to produce the documents, the applicants are asking the court for leave to apply for them from Bank Negara Malaysia, along with costs of the action and other relief deemed necessary by the court.
The investors, including three companies and an institute, cited a notice that had been issued for the court-convened meeting by ACE Credit’s liquidators to all unsecured creditors.
They said the liquidators admitted during the first meeting with unsecured creditors on Sept 3 that the debt of the unsecured creditors, including themselves, came up to RM877.595 million in the statement of affairs compared to the overall claim of RM907.145 million.
Further, ACE Holdings itself is also an unsecured creditor claiming RM796.880 million, the liquidators were also cited as saying that during the same meeting.
On Aug 29, ACE Credit through the joint liquidators were given leave to summon a court-convened meeting under Section 366(1) of the Companies Act to vote on the proposed scheme of arrangement to restructure the company’s financial condition.
The investors argued that the power to the liquidators in winding up is bestowed by the court and since it is within the court’s control, any creditor could apply to the court for any implementation or proposal to the power.
The document's revelation would highlight the importance of answering all queries and disputes regarding the transparency of the restructuring of the proposed scheme of arrangement.
There are also questions as to the sum of RM796.880 million sought by ACE Holdings, which is also an unsecured creditor that had been wholly accepted by the liquidator, even as the applicants’ claim had not been admitted in full.
That creates the special circumstances for the stay of the court-convened meeting as applied for, they added.