Kenmark update : SC freezes Ishak’s gain
Filed Under (Business News) by Webmaster on 17-06-2010
Tagged Under : Ishak Ismail, James Hwang, Kenmark
The Securities Commission (SC) has obtained an injunction to prevent Datuk Ishak Ismail from using the RM10.2 million he got from selling 58.7 million shares in financially troubled Kenmark Industrial Co (M) Bhd (7030).
Ishak, who ceased being a substantial shareholder upon the sale, is suspected of breaching securities laws, the SC said in a statement yesterday.
It is believed that this is the first time the SC has secured a court order to freeze proceeds from a share sale.
The Kuala Lumpur High Court has also ordered Ishak to give full and complete details of his assets, whether in Malaysia or elsewhere, within four days.
Ishak, the former deputy executive chairman of KFC Holdings (Malaysia) Bhd, had emerged as Kenmark’s biggest shareholder with a 32.36 per cent stake early this month.
He bought the shares on June 1 and 2 while others were busy dumping the stock in panic upon hearing that Kenmark managing director James Hwang was missing and that it was late with its financial results.
(Hwang later came out to say he had been sick and uncontactable in China.)
The furniture maker’s share price, which had plunged to as low as 3.5 sen a share on June 1, was trading at 26 sen a share by June 4, boosted by news that Ishak had bought the substantial stake.
He is said to have sold the nearly 60 million shares linked to him on June 9 and 11.
Kenmark, in a filing to the stock exchange yesterday, said it did not know who the shares were sold to. It also has not been notified of any changes to the board since the sale.
It has, however, requested Bursa Malaysia Depository for the latest record of depositors and will be able to identify the new controlling shareholders once that information is available.
Kenmark, the third most actively traded stock yesterday, shed 1 sen to 10 sen.
Ishak, meanwhile, could not be reached for comment yesterday. A news report earlier quoted him as saying that he had sold the shares because Hwang had not returned to manage the company as agreed when he first bought the shares.
Hwang, a Taiwanese, and another director, Chen Wen-Ling, have cut their holdings in the PN17 company and own 8.41 per cent and 7.76 per cent stakes respectively as at June 7.
The SC said investigations are actively being pursued on possible breaches of securities laws within Kenmark, especially with respect to its previous board, management and key shareholders.
Executive director Ho Soo Woon is currently in charge of Kenmark’s day-to-day management and operations.
Kenmark said yesterday that employees at its Port Klang operations had resumed work as of June 7. Its wood division operations have also resumed and the management is trying to fulfil outstanding orders.
As for the printing division, the management is assessing equipment and machinery to enable the company to meet its deliveries.
It also said that its assets in Vietnam are mostly intact and it is talking with suppliers and financiers to resume operations there as soon as possible.
