KUALA LUMPUR (Sept 12): Bursa Malaysia Securities has reprimanded Fitters Diversified Bhd (KL:FITTERS) and fined five of its current and former directors RM400,000 each for failing to comply with requirements for immediate disclosure and shareholder approval for related-party transactions involving the company's acquisition of shares in Computer Forms (M) Bhd (KL:CFM).
The five who were fined include chairman Datuk Sok One Esen; independent, non-executive director Wong Kok Seong; former executive directors Hoo Swee Guan and Datuk Seri Gan Chow Tee; and former independent, non-executive director Kho See Yiing. Each was fined RM400,000 after the regulator determined they had allowed the listing rule breaches.
The reprimand concerned wholly-owned unit Fitters Development Property Sdn Bhd's acquisition of Computer Forms securities in early March 2023 and their subsequent disposal later that month.
Bursa said Fitters Diversified failed to make an immediate announcement when the unit acquired 12.14 million Computer Forms shares representing a 4.54% stake for RM26.44 million cash and 6.18 million Computer Forms Warrants A for RM8.33 million on March 7 and 8. The acquisitions were only disclosed on March 9.
The regulator also noted that the eventual disclosure was inaccurate, as it incorrectly stated that the acquisitions were not subject to shareholder approval. As acquisitions were deemed related-party transactions because Fitters Diversified and Computer Forms shared a common major shareholder at the time, Datuk Seri Jacky Pang Chow Huat, they required shareholder approval. Fitters Diversified, however, only sought ratification from non-interested shareholders for the deals on April 4.
Fitters Diversified had also failed to appoint an independent adviser, issue a circular and obtain shareholder approval before the acquisitions took place, Bursa said.
"The company had only appointed an independent adviser for the acquisitions ratification on March 16, 2023, announced the circular to shareholders on the acquisitions ratification on Sept 7, 2023, and obtained the acquisitions ratification by its non-interested shareholder on Sept 22, 2023,” Bursa noted.
The same breaches — including the failure to make an immediate announcement, seek shareholder approval and appoint an independent adviser — were repeated for the subsequent disposals of the Computer Forms securities on March 14, 21, and 22, 2023.
“Fitters Diversified had only announced the disposals and that the company shall seek the approval of its non-interested shareholders for the ratification of the disposals on June 26, 2023,” Bursa added.
Shares in Fitters Diversified closed half a sen higher at three sen on Friday, giving the company a market capitalisation of RM70.62 million.
The group is involved in a variety of businesses, including fire protection products and services, property development and construction, renewable energy, and the manufacturing of PVC pipes.