South Malaysia Industries Berhad complaints to Securities Commission Malaysia after identifying over 20 parties comprising companies and individuals acting in concert with Honsin Apparel Sdn Bhd and HiQ Media (Malaysia) Sdn Bhd to acquire more than 33% equity stake in SMIB in the last six months which contravenes Capital Markets and Services Act 2007.
According to “CMSA Section 218 (2), the companies need to make a mandatory general offer to acquire all the shares in SMIB not held by them. This was further revealed in the court papers filed by SMIB to defend against the suit brought about by Honsin and HIQ
SMIB in a press statement added that Prolexus Berhad, which is the holding company for Honsin and HIQ, the parties acting in concert with them, among others are another listed company YB Ventures Berhad, one of the Executive Directors and a substantial shareholder of both Prolexus Berhad and YB Ventures Berhad alongside some close relatives, as interpreted by CMSA Section 216 (3).
Honsin and HIQ had on 23 February 2023 filed a suit at the Kuala Lumpur High Court in an attempt to compel SMIB to provide the record of depositors, the parties had informed of their intention to call an EGM to replace the entire SMIB Board of five persons including all the independent directors with no justifications or reasons and appoint in their place, just two persons nominated by them.
SMIB said these parties acting in concert are attempting to take over the company without making a mandatory general offer, which is against the Takeover and Mergers Code. If they succeed, they will take control without consideration for the rights of all other shareholders including minority shareholder
