KUALA LUMPUR (Aug 21): Confectionery manufacturer Khee San Bhd (KL:KHEESAN) said on Friday that six bank accounts belonging to its wholly-owned subsidiary Khee San Food Industries Sdn Bhd (KSFI) have been frozen following an investigation under Malaysia’s anti-money laundering law.
In a bourse filing, Khee San said KSFI was notified on Friday that the six accounts maintained with a bank had been frozen pursuant to the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA) probe. The company did not identify the bank.
The accounts are actively used to support the group’s day-to-day operations, and the freeze is expected to cause some disruption to the group’s operations, Khee San said.
“However, the board is of the view that, at this juncture, the matter is not expected to have a material financial impact on the group,” it added.
Khee San said it is taking the necessary steps to resolve the matter and will cooperate fully with the relevant authorities in connection with the investigation.
Khee San is known for confectionery products including Fruit Plus and Torrone, and owns a manufacturing plant in Seri Kembangan, Selangor.
The company remains classified under Practice Note 17 (PN17), despite completing its regularisation plan on March 17. The plan involved a scheme of arrangement to settle debts, a share capital reduction, a rights issue and an employees’ share scheme.
To recap, Khee San was classified as a PN17 company in November 2021 after KSFI, which accounted for more than half of the group’s total assets, was placed under judicial management following an application by Maybank Islamic Bhd. KSFI was subsequently involved in legal disputes with several banks over outstanding debts.
The company was loss-making from FY2019 to FY2022 before returning to the black in FY2023.
However, it slipped back into the red in the third quarter ended March 31, 2026 (3QFY2026), with a net loss of RM11.92 million compared with a net profit of RM102,000 a year earlier. Revenue declined slightly to RM14.12 million from RM14.51 million.
The quarterly loss was mainly due to RM14.44 million in one-off expenses related to the vesting of shares under its employee share grant scheme, partly offset by a gain from debt waivers under its scheme of arrangement with creditors.
Shares of Khee San closed one sen or 8.7% lower at 10.5 sen on Friday, giving the company a market capitalisation of about RM128.9 million.