This article first appeared in The Edge Financial Daily on December 5, 2019

KUALA LUMPUR: London Biscuits Bhd is no longer a major shareholder of associate Khee San Bhd.

Financially stressed London Biscuits announced to Bursa Malaysia that it has sold out all its shares in Khee San, which will soon have new controlling shareholder, Mamee-Double Decker (M) Sdn Bhd.  

In a separate filing with Bursa by Khee San yesterday, it showed that London Biscuits has disposed of its entire holding of 20.80 million shares on the open market.

According to Khee San’s annual report for the financial year ended Dec 31, 2018 London Biscuits held 20.80 million shares or a 20% stake and was the largest shareholder in the candy manufacturer.

However, the Liew family, which currently holds 7.76% stake in London Biscuits, is still left with a 6.3% equity interest in Khee San.

London Biscuits’ stake sale came on the heels of the news that snack food maker Mamee-Double Decker intends to buy into Khee San through a share placement, which will be followed by a cash call. Besides, London Biscuits is in the midst of reviving its financial health after it has defaulted loans amounted to RM111.7 million.

Mamee-Double Decker will buy 94 million Khee San shares, which represent the 45.11% of the latter’s enlarged share capital at 25 sen apiece.

Consequently, Mamee-Double Decker will be a substantial shareholder in Khee San. And it is obliged to extend a mandatory general offer for the remaining Khee San shares it does not already own.

Mamee-Double Decker, which was taken private in 2012, wants to maintain the listing status of Khee San on Bursa Malaysia.