Note: This article has been amended for accuracy.
KUALA LUMPUR (Aug 24): Khee San Bhd’s (KL:KHEESAN) largest shareholder Datuk Seri Ngu Tieng Ung has stepped down as the executive chairman of the confectionery manufacturer with immediate effect, three days after six bank accounts of a key subsidiary were frozen amid an anti-money laundering investigation.
In a bourse filing on Monday, Khee San said Ngu, 59, resigned due to “personal reasons”.
Ngu joined Khee San’s board on Sept 24, 2024, before being redesignated as the executive chairman a year later, replacing Yong Loong Chen, who was subsequently redesignated as the managing director.
Ngu’s daughter, Chienn Ying, is also currently a member of Khee San’s board.
Ngu holds a 27.18% indirect stake in Khee San through his private vehicles Heritage Winners Sdn Bhd and Juarastasi Aman Sdn Bhd. He also holds 120,000 shares, or a 0.01% direct stake, in the company.
His resignation came just three days after Khee San disclosed that six bank accounts belonging to its wholly owned subsidiary Khee San Food Industries Sdn Bhd (KSFI) had been frozen amid an investigation under Malaysia’s anti-money laundering law.
In a separate filing, Khee San said the six accounts had an aggregate balance of about RM1.89 million when they were frozen.
The company said it had yet to receive formal written clarification from the Royal Malaysian Police (PDRM) on the specific circumstances leading to the investigation.
“However, based on information conveyed by the PDRM to the company, the freezing of the accounts is not due to or connected with the operations or business activities of the group,” it said.
Khee San said it had submitted an appeal to the PDRM on Monday to lift the freezing order and unfreeze the accounts, while continuing to seek further clarification and cooperate with the authorities.
It added that the freeze had resulted in some immediate operational implications, particularly the receipt and processing of customer payments, as the affected accounts were among those used by KSFI to collect payments.
Further, it said the freeze could also affect payments to suppliers and staff salaries through the affected accounts, but the company is taking measures to manage the payment arrangements and minimise disruption to its operations.
The company also has access to alternative options to support and facilitate its ongoing business operations.
Khee San, known for confectionery products including Fruit Plus and Torrone, completed its regularisation plan earlier in March. The plan included a scheme of arrangement to settle its debts, a share capital reduction, a rights issue and an employees’ share scheme.
It is now awaiting Bursa Malaysia’s approval to exit its Practice Note 17 (PN17) status.
The company slipped 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 the employee share grant scheme, partly offset by a gain from debt waivers under the scheme of arrangement with creditors.
Khee San shares settled 1.5 sen, or 14.3%, lower at nine sen on Monday, giving the company a market capitalisation of RM110.5 million.