This article first appeared in The Edge Malaysia Weekly on October 27, 2025 - November 2, 2025

Bursa Malaysia’s warning to MAA Group Bhd (KL:MAA) not to proceed on its own to hold an extraordinary general meeting (EGM) for the sale of Deutsche KNM GmbH (Borsig) comes with a clear message to KNM Group Bhd (KL:KNM).

KNM, which owns Borsig, cannot convene an EGM to vote on the sale until the outcome of an appeal on the oil and gas services provider’s financial regularisation plan is known.

Bursa’s decision leaves KNM’s board with little choice but to comply with the regulator’s rules. This is despite MAA, which is the largest shareholder in KNM, wanting to convene the EGM on Oct 30.

KNM, which has debts amounting to RM1.33 billion, has been classified as a Practice Note 17 (PN17) company since October 2022. Its regularisation plan, which involves the disposal of Borsig for RM1.2 billion, with the proceeds to be used to settle debts, was rejected by Bursa on Oct 3. As a result, KNM has to undergo a capital restructuring exercise to downsize its capital to reflect its reduced business scale.

Bursa rejected the plan on the grounds that, following Borsig’s disposal, KNM’s remaining businesses would be inadequate to support the requirements of a listed company. In addition, KNM cannot take on jobs from Petroliam Nasional Bhd directly as it has been designated non-compliant with the national oil and gas company’s special licensing conditions.

Even if MAA proceeds with the EGM and shareholders approve the sale, the exercise would be merely academic if the appeal is rejected. If that happens, KNM could face suspension and delisting, and the sale of assets would then fall under the Companies Act.

So why earn Bursa’s wrath? Why not wait for the outcome of the appeal?

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