26 June, 2010

Securities Commission gets injunction against Datuk Ishak Ismail

The Securities Commission (SC) obtained an ex parte injunction to refrain Datuk Ishak Ismail from dealing with the RM10.2mil worth of proceeds he got from the sale of his shares in troubled furniture maker, Kenmark Industrial Co (M) Bhd.

This is the first such case where the SC acted to prevent dealings in the cash proceeds from a share sale, but in the past the commission had obtained injunctions to prevent disposal of assets in the Swisscash case and stop usage of funds from land sale in the The Ayer Molek Rubber Co Bhd case.

The SC obtained the injunction yesterday following its investigations into suspected breaches of securities laws by Ishak.

The commission is not about to stop where Kenmark is concerned. In fact it is actively investigating possible breaches of securities laws at the company, especially with respect to its previous board, management and key shareholders.

The SC said in a statement yesterday that the Kuala Lumpur High Court had also ordered Ishak to furnish within four days full and complete details of his assets, whether in Malaysia or elsewhere.

The SC said the RM10.2mil proceeds were from the sale of 58.7 million shares.

It is learnt that Ishak bought the Kenmark shares at between 5.8 and six sen each and subsequently sold them between June 9 and 11 at prices between 14 and 16 sen.

His entry and exit from Kenmark within 10 days from early June had raised eyebrows in the investing community. Ishak had said he was getting into Kenmark to help a friend (James Hwang, the managing director of Kenmark) and to offer re-employment to the company’s workers.

Ishak sold his entire direct and indirect 32% stake in the company after he failed to convince Hwang to come back to the company.

The Kenmark saga began when Hwang, a Taiwanese, disappeared mysteriously and that led to the closure of the company’s plants in Port Klang and Vietnam. Nearly a week after his disappearance, Hwang said his absence was due to an illness.

Soon after, Ishak made his brief entry.

Like the SC, Bursa Malaysia is also busy scrutinising documents for possible breaches while the Minority Shareholder Watchdog Group (MSWG) chief executive officer Rita Benoy Bushon wants those responsible for Kenmark’s troubles brought to book.

Kenmark shares continued to fall yesterday, shedding one sen, or 9%, to 10 sen on volume of 18 million shares.

Separately, Kenmark said in reply to a Bursa query that it did not know the identity of the new controlling shareholders following Ishak’s exit as a substantial shareholder.

On its Port Klang operations, it said workers had reported back for work on June 7. Its wood division resumed operations and the management is working towards fulfilling outstanding orders.

As for the printing division, the management was still assessing the condition of equipment and machinery to get them back into working order to meet deliveries, it said.

The equipment and machinery were substantially intact at its Vietnam plant and negotiations were ongoing with suppliers and financiers to resume operations there as soon as practicable, the company said.

Kenmark also said Ho Soo Woon, an executive director, was in charge of the day-to-day management and operations of the company.

The reply to Bursa was made on the collective approval by the four new directors, Datuk Abd Gani Yusof, Ho, Ahmad Azhar Abdullah and Woon Wai En.

“The Taiwanese directors, Hwang, Chen Wen-Ling and Chang Chin-Chuan, have not responded with any comments on the query (from Bursa),’’ Kenmark said.


(Source)

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