SINGAPORE (July 6): SBI Offshore’s former chairman and CEO Jonathan Hui Choon Ho is making another attempt to gain some control of the company’s board by calling for an extra-ordinary general meeting.
In a July 6 letter to the board, Hui, who owns 7.92% of the company, has teamed up with another shareholder Paul Goh Ju Poh, who claims to own 2.82%, to oust an existing director and appointment their nominee.
Under Singapore company laws, shareholders who hold more than 10% can call for EGMs.
Goh and Hui want to remove Ahmad Subri Bin Abdullah from the company’s board, as they believe that the KL-based independent director will not be as effective given the SBI Offshore’s business will be more Singapore-based. He was appointed to the board on Dec 10 2018.
They want to appoint one Percival Jeyapal s/o David, with some 50 years of experience in marine offshore and oil services, to the company’s board, instead.
Hui stepped down as an executive director of the company on August 17 2012 and resigned as a non-executive director on Sept 14 2012 to pursue other interests.
In Jan 2018, Hui and a couple of other shareholders tried to call for an EGM so that three directors on the board then can be ousted and that Percival, another nominee, and Hui himself can be appointed to the board.
Following subsequent “subsequent communications” with SGX RegCo, SBI Offshore’s board, by then headed by then executive chairman Mirzan Bin Mahathir, rebuffed the request, citing, among other issues, Hui’s previous involvement with a deal involving Jiangyin Neptune Marine Appliance.
A CAD probe was made but insufficient evidence was found and no further action taken, said the company in March 2018.
In addition, while recognising Percival’s experience as an engineer, the SBI Offshore board then said he has no experience as a director of a listed company.
Hui's move came barely a week after Mirzan was voted out by shareholders at the company’s annual general meeting on June 29. He is the son of former Malaysian prime minister Dr Mahathir Mohamad.
He was subsequently reappointed as the company’s interim CEO so that he can help see through an RTO deal already in motion.
According to the company in a filing to the stock exchange, 70.05% of the valid votes were against his reappointment, versus just 29.95% in favour.
Mirzan became a substantial shareholder of SBI Offshore back in Sept 2014 after buying 10.8% of the company via a private placement at 26.05 cents per share.
At the AGM, another director, James Kho Chung Wah, was re-elected.
Ahmad Subri, who is targeted by Hui and Goh in their latest EGM requisition notice, wasn’t slated for re-election at the AGM.
On June 12, SGX RegCo said is looking into SBI Offshore for potential listing rule breaches as well as potential contravention of directors’ fiduciary duties, following the release of a special audit by RSM Corporate Advisory.
The special audit was ordered by SGX RegCo back in December 2018, to probe the sale of a factory in China sold by SBI Offshore at just RMB18 million – a significant discount off its book value of RMB38 and 40 million.
The special audit, released by RSM on June 12, concluded that SBI Offshore did undertake an “adequate and reasonable” process to try and sell that factory. The transacted price of RMB 18 million represented the best offer they received during the period.
However, based on the RSM special audit, several other issues related to the same factory has arisen.
For one, when SBI Offshore bought the factory, the acquisition agreement did not contain sufficient details of the assets to be acquired.
No valuation was conducted prior to the execution of the acquisition agreement to assess and support the purchase consideration of RMB32 million.
(Story has been updated on July 7 to correct date when Hui left the company's board, and to add further developments on the Jiangyin Neptune Marine Appliance case).
