KUALA LUMPUR (Feb 13): VS Industry Bhd (KL:VS) said water filtration system maker NEP Holdings (M) Bhd has been placed under liquidation after the Court of Appeal dismissed NEP’s appeal against the High Court’s decision to dismiss their application for a stay of a winding up order.

“Following this, NEP’s liquidators have obtained the certificate of appointment as liquidator from the insolvency department and have taken control of NEP’s business and operations,” the electronics manufacturing services provider said in a statement on Thursday.  

Last month, the High Court ruled in VS Industry’s favour in its minority shareholder oppression suit against NEP Holdings (M) Bhd and three directors. The decision came with an order for NEP to be wound up.

VS Industry owns 20% stake in NEP, which it acquired back in 2016 for RM60 million.

“The court determined that VS Industry had successfully proven that NEP’s affairs were conducted, and its directors’ powers exercised, in a manner oppressive to or in disregard of VS Industry’s interests as a shareholder,” VS Industry said.

The dispute between VS Industry and NEP stems from the unit's failure "to hold board meetings or annual general meetings since 2021, withheld audited financial statements and did not distribute agreed dividends despite reported profits".

“These actions deprived VS Industry of its statutory shareholder rights, prompting the company, on legal advice, to file an oppression suit in July 2023, seeking NEP’s winding up and the appointment of private liquidators to investigate its affairs,” it added.

The directors named in the suit were Lim Chang Huat, Lim Chee Kon and Chow Chun Pooi @ Chow Chan Leong. Based on Companies Commission of Malaysia filings, NEP is 78.61%-owned by Chang Huat.

According to VS Industry, NEP is known for its “Diamond” brand of water filtration system products. The now wound-up company’s product range also includes coffee machines and capsules under the brand “Arristo”.

Shares in VS Industry ended one sen or 0.93% higher at RM1.08, valuing the company at RM4.25 billion.