15 July 2017
MSWG’S QUICK TAKE ON-ONGOING CORPORATE DEVELOPMENTS
AXIS INCORPORATION BHD (“AXIS”)
The Kuala Lumpur Sessions Court convicted and jailed two former executive directors of Axis Incorporation Bhd (Axis) for furnishing false statements to Bursa Malaysia.
Lee Han Boon and Saipuddin Lim Abdullah both pleaded guilty for furnishing false information to the stock exchange in relation to Axis’ revenue of RM91.13 million. Out of that amount, RM51.5 million was false for the fourth quarter ended 31 March 2008. Lee and Saipuddin also respectively faced four other counts of the same offence in relation to Axis’ consolidated income statement for all four quarters in its financial year ended 2007.
Lee, 36, a former substantial shareholder and executive director of Axis was sentenced to seven months imprisonment and fined RM200,000. Saipuddin, 58, also a former substantial shareholder and executive director of Axis was sentenced to 12 months imprisonment.
The trial against Lee and Saipuddin started in 2015. It will continue against two other individuals, Koh Tee Jin and Lee Koon Huat, who were charged and jointly tried with Lee and Saipuddin for the same offences.
[Source: Media release on SC’s website on 10 July 2017]
07 July 2017
VOICE OF MSWG
AOB: AUDITORS SHOULD IMPROVE QUALITY CONTROL
Capacity building efforts are continuing apace in Malaysia with the Securities Commission (SC) expressing concerns over the work of auditors with questions raised recently over audit quality issues and urging auditors to up their ante in service delivery.
In lauding the SC’s Audit Oversight Board (AOB) move to point out heightened deficiencies among audit firms relating to revenue recognition, inventory, group audits and related-party transactions such as to potentially harm the integrity of the local capital markets, we are also encouraged by its collaborative approach in their desire to guide and monitor such remediation efforts.
Due to the Hari Raya Festival Holiday, there will be no newsletter in the coming week. Our newsletter will be back in the first week of July 2017.
MAXIS BERHAD (“MAXIS”)
The Board of Directors of Maxis announced that Maxis proposes to issue 300,000,000 new Maxis Shares (“Placement Shares”) under the Proposed Private Placement to investors to be identified via book-building. This represents approximately 4.0% of the total number of issued shares of Maxis as at 16 June 2017 of 7,510,510,600 Maxis Shares pursuant to the shareholders’ mandate obtained at Maxis’ annual general meeting held on 26 April 2017 under Sections 75 and 76 of the Companies Act, 2016.
[Source: Maxis’ announcement on Bursa Malaysia’s website on 19 June 2017]
MALAYSIA BUILDING SOCIETY BERHAD (“MBSB”)
The Board of Directors of MBSB announced that the Company had on 19 June 2017 submitted an application to Bank Negara Malaysia within the stipulated timeframe, to seek the approvals of BNM and/ or the Ministry of Finance, Malaysia for the proposed merger of MBSB and Asian Finance Bank Berhad.
[Source: MBSB’s announcement on Bursa Malaysia’s website on 19 June 2017]
19 June 2017
VOICE OF MSWG
More than six months after EPF exited its entire stake in FGV, likely at a loss, the likely rationale behind its actions at that time now seem to have manifested; with the emergence of a very public and damaging tussle between Chairman and CEO.
FGV’s challenges are many and deep-rooted, but we do not feel -- at all -- that the appointment of Datuk Seri Idris Jala could have been effective, as he is neither independent nor neutral, by virtue of his position in PEMANDU as well as his former role as Minister in the Prime Minister’s Department.
And while his accomplishments at PEMANDU may have been commendable, no details are available as to his current role at FGV in the context of his exact terms of reference. We also understand his report has been submitted to Prime Minister Datuk Seri Najib – this is certainly fast but will the investigation be comprehensive and exhaustive enough to be effective? Will it leave no stone unturned? More importantly is will the critical weaknesses and lapses be clearly identified with remedial actions to be taken and how to put the Group onto a stronger footing. And will the report be made public?