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)

Asian stocks continue to slide

Asia's stock markets continued to tumble Thursday on concerns that a slowing U.S. economy could spell trouble for Asia's export-dependent economies. The losses extended the rout that began in China Tuesday and swept through global markets.

East Asia's largest markets — in Japan, Taiwan and China — ignored a rebound on Wednesday on Wall Street, where stocks rose after encouraging comments on the economy by Ben S. Bernanke, chairman of the Federal Reserve.

Japan's benchmark Nikkei-225 fell as much as 1.55 percent, while the benchmark in Taiwan fell as much as 2.67 percent. Stocks in China also dropped, with one benchmark index of exchanges there falling roughly 1 percent. The stock market in South Korea was closed for a public holiday.

Bernanke told a congressional panel that Wednesday's slump in stock prices did not change the Fed's forecast for moderate economic growth in the United States. His testimony helped restore confidence among investors, sending the Dow Jones industrial average up 52.39 points, or 0.4 percent. The Standard & Poor's 500-stock index closed up 0.56 percent and the Nasdaq rose 0.34 percent.

Bernanke's optimism was echoed by economists around Asia, who said that the latest sell-off was more a sign of investors' anxiety about record-breaking rallies over the past several months than a reflection of any downturn in Asia's economic prospects.

"We're seeing some blowing off of some froth in the equity markets and that's probably a good thing," said Peter Morgan, regional economist at HSBC in Hong Kong. Morgan likened the latest drop in stock prices to the correction in emerging market stocks that began in India last May. Stocks there dropped almost 30 percent, but had recovered by mid-October along with the region's other markets.

"We don't think it has any major macroeconomic significance," he said of this week's tumble.

Chinese stocks, for example, had more than doubled in the year leading up to Tuesday's slide.


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Malaysian Bonds Advance as Stock Prices Fall; Ringgit Weakens


Malaysia's local-currency bonds gained on speculation slowing growth in the U.S. will curb demand for exports from the Asian nation's biggest market. The ringgit weakened for a third day.

Five-year yields held near the lowest in 15 months after Asian stocks slumped for a second day, adding to the steepest drop in eight months yesterday as investors reduced risk. The government is scheduled to auction an undisclosed amount of three-year notes this month as 4.8 billion ringgit ($1.37 billion) of the debt matures.

``There's justification to switch to bonds if the stock market continues to tank,'' said Jason Wong, head of fixed-income research at CIMB Investment Bank Bhd. in Kuala Lumpur. ``People are more likely to be buying debt before the large amount that is maturing because supply is looking a bit insufficient this month.''

The yield on the 3.718 percent note due in June 2012 dropped 1 basis point, or 0.01 percentage point, to 3.62 percent as of 3:40 p.m. in Kuala Lumpur, according to the central bank. The price rose 0.06, or 60 sen per 1,000 ringgit face amount, to 100.48.

Japan's Nikkei 225 Stock Average lost 0.9 percent while the Shanghai and Shenzhen 300 Index, which triggered the global stock rout on Feb. 27, dropped another 2.8 percent. Malaysia's Composite Index fell as much as 1.1 percent today.

Malaysia's $147 billion economy grew 5.7 percent in the fourth quarter, the slowest in a year, compared with 5.8 percent in the third quarter, after overseas demand waned, Bank Negara Malaysia said yesterday.

The nation relies on the U.S. for one-fifth of its exports, primarily electronics and electrical goods. Exports growth slowed to 6.2 percent from November's 18 percent gain, the government said last month.

Malaysia's currency swung between gains and loses today, and was last 0.1 percent lower at 3.5050 against the dollar in Kuala Lumpur, according to data compiled by Bloomberg. It earlier rose as much as 0.4 percent.

``The developments in these two days in the global, regional and domestic financial markets reflect the potential for contagion,'' Bank Negara said in a statement after the market closed yesterday. While Malaysia is not insulated, the developments ``have not had any material impact on the markets,'' it said.

Source : www.biznewsdb.com


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