V.S. Industry Berhad announced that the Kuala Lumpur High Court has found NEP Holdings (Malaysia) Berhad and its directors, Lim Chang Huat a.k.a Dato’ Michael Lim, Lim Chee Kon, Chow Chun Pooi @ Chow Chan Leong as well as NEP’s General Manager, Kong Kian Huat guilty of contempt of court after failing to abide by the Inspection Order granted by the High Court. This is with regards to the Originating Summons filed in January 2022 by VS and Datuk Beh Kim Ling for inspection of NEP’s accounting record by an auditor approved by the Group and DB.
To recap, VS acquired a 20%-stake in NEP back in 2016 and had entered into a shareholders’ agreement with LCH, LCK and NEP to govern the rights, duties, liabilities and obligations of the shareholders in relation to the management and operation of NEP and its subsidiaries. However, NEP failed to fulfil their obligations, including failure to hold annual general meetings for their financial year ended 2021 (“FY2021”) and FY2022, as well as to file their audited accounts for the same periods.
The High Court in June 2022 granted VS and DB an Inspection Order for NEP to, amongst others, open its accounting record for inspection by the Group’s Auditor and make available all accounting records for Group’s Auditor to make copies. Unfortunately, NEP has failed to fully comply with the order. Consequently, NEP along with the NEP Directors and General Manager has now been found guilty of contempt of court. The passing of the sentence against them by the High Court will take place on 24 August 2023.
Separately, VS and DB had also on 25 July 2023 filed another OS for oppression of minority shareholders, seeking, inter-alia, an order for NEP to be wound up and an order for Datuk Ooi Woon Chee and Mr. Wong Ching Yong of DC Restructuring Solutions PLT be appointed as joint and several liquidators of NEP.
NEP is a local company famous for its “Diamond” brand of water filtration system products that is used in thousands of households across Malaysia, Hong Kong, Singapore, and China. Established since 1995, NEP has since expanded its product range to include coffee machines and coffee capsules under the brand “Arissto”. As part of its business model, NEP operates the Arissto iPartner Coffee Machine Investment programme that allows the public to participate in the incentive-sharing plan, allegedly to earn commission and additional income.
