KUALA LUMPUR (June 8): M3 Technologies (Asia) Bhd (M3Tech) said today that the unusual trading activity of its shares could be due to several corporate announcements, including the settlement of its dispute over the acquisition of a stake in Fotokem Sdn Bhd.

In reply to an unusual market activity (UMA) query, M3Tech reiterated it had reached a settlement over its dispute with five individuals relating to the company's purchase from them in 2013, of 383,900 shares or a 24% stake in Fotokem.

Yesterday, M3Tech said that the five individuals will buy back the 24% stake from M3Tech under the settlement, for RM5.998 million, of which RM2.218 million is deemed as settlement for the sum claimed under the profit guarantee, and RM3.78 million as the stake's selling price.

Proceeds from settlement of RM5.998 million will be utilised for the M3Tech's working capital needs and is expected to be utilised within three months.

M3Tech had purchased the 24% stake from the five individuals — Ngui Woon Kong, Wong Lim Patt, Thean Yoke Peng, Shum Hok Yein and Khoo Chee Kuen — for RM5.998 million.

Disputes subsequently arose between M3Tech and the five, including over a profit guarantee of RM2.218 million, purportedly given to M3Tech.

M3Tech was one of the top 3 most active counters on Bursa Malaysia this morning, after announcing the settlement over the Fotokem purchase.

The company also cited its proposal last year for a renounceable rights issue with detachable warrants and employees’ share option scheme, among others, of possible reasons for the jump in trading volume of its shares.

M3Tech shares closed 10.5 sen or 43.75% lower today at 3.5 sen, for a market capitalisation of RM37 million.