KUALA LUMPUR (Dec 8): The Employees Provident Fund (EPF) has ceased to be a substantial shareholder of VS Industry Bhd, the company informed Bursa Malaysia on Wednesday (Dec 8).

The provident fund’s stake in the company dropped below 5%, after it sold 21.68 million shares on Dec 2, according to VS Industry's filing.

Based on back-of-the-envelope calculations, the latest transaction leaves EPF with 175.47 million shares in VS Industry, representing a stake of about 4.6%.

On the same day the transaction took place, shares in the electronics manufacturing service (EMS) provider fell by 19.01% or 27 sen to RM1.15. It also emerged as the sixth top loser of the day on Bursa Malaysia.

On Dec 6, the group issued a joint statement with labour rights activist Andy Hall, after it reached out to Hall following references the latter made about the company during a recent investor briefing on the topic of migrant workers' welfare in Malaysia.

"At VS, we place high priority on ESG (environmental, social and governance) matters, and are committed to maintaining our high standards of corporate governance.

"Obviously, managing a large pool of migrant workers indeed comes with challenges. As such, we have experienced and trained personnel in charge of the management of migrant workers.

"We are in compliance with all government regulations with regard to our migrant workers. We have also passed the latest audit checks by the Responsible Business Alliance or RBA, as well as by our key customers with no material issues highlighted,” said VS Industry managing director Datuk SY Gan in the joint statement.

Hall, meanwhile, said he continued to mention in his capacity as an independent guest speaker at conferences and investor briefings that there is a need to conduct further due diligence with regard to the situation of migrant workers at the suppliers of many multinational companies' brands in Malaysia.

"My areas of concern include the legality of the use of outsourced migrant workers through third party agents, the risks inherent in the government's recalibration scheme, as well as working hours, living wage and social dialogue issues, amongst others. However, my recent comments were not meant as a direct reference to indicate irremediable migrant worker issues at VS," he added.

Gan said the group acknowledged and appreciated the concerns brought up by Hall and said it is open to working with external parties, including civil society who can add value and further strengthen its Environmental, Social and Governance (ESG) initiatives, including on enhancing the welfare of migrant workers.

Shares in VS Industry slipped two sen or 1.59% to settle at RM1.24 on Wednesday, giving it a market capitalisation of RM4.75 billion.