KUALA LUMPUR (Dec 10): PPB Group Bhd (KL:PPB) said its 80%-owned subsidiary, FFM Group, will file a judicial review application at the High Court to challenge the Competition Appeal Tribunal's (CAT) decision to dismiss its request for a stay on a RM42.7 million penalty imposed by the Malaysia Competition Commission (MyCC).
The penalty relates to allegations of collusion in a "chicken feed cartel" to fix poultry feed prices.
FFM Group, the grains and agribusiness arm of PPB, received a letter of demand from MyCC on Monday, requiring the penalty payment within seven days.
“FFM will proceed to file an application for leave to institute judicial review proceedings at the High Court against the CAT’s decision to dismiss FFM’s stay application and an ad interim stay order in respect of the decision, pending the decision on FFM’s application for judicial review,” PPB told Bursa Malaysia on Tuesday.
FFM's businesses — flour milling, animal feed manufacturing, grains trading and livestock farming — accounted for 75% of PPB’s total revenue for the financial year ended Dec 31, 2023, according to PPB’s latest annual report.
FFM is among five feedmillers penalised by MyCC with a record RM415.5 million fine, the largest imposed in the quasi-judicial body’s 12-year history.
The other four companies are Leong Hup International Bhd (KL:LHI), operating via its wholly-owned subsidiary Leong Hup Feedmill Malaysia Sdn Bhd; Malayan Flour Mills Bhd (KL:MFLOUR), via its partially-owned subsidiary Dindings Poultry Development Centre Sdn Bhd; Gold Coin Feedmills (M) Sdn Bhd under Gold Coin Group; as well as PK Agro-Industrial Products (M) Sdn Bhd under Charoen Pokphand Holdings (M) Sdn Bhd, which in turn is a subsidiary of the Thai conglomerate Charoen Pokphand Group Co Ltd.
MyCC imposed the fine in December 2023, after the feedmillers were found to have infringed Section 4 of the Competition Act 2010 by entering into anti-competitive agreements and/or concerted practices in increasing the price quantum of poultry feed that contains soybean meal and maize as its main ingredients, between early 2020 and mid-2022.
In August 2022, MyCC provisionally found that the five enterprises had infringed the competition law, and later granted the companies opportunities to submit written and oral representations. Parent companies Leong Hup International and PPB Group rejected MyCC's provisional findings, asserting that the allegations against their subsidiaries were without merit.
Shares of PPB gained four sen or 0.31% to close at RM12.90 on Tuesday, giving a market capitalisation of RM18.29 billion.