Low Bok Tek to surface as a substantial shareholder of Gets Global?

This article first appeared in The Edge Malaysia Weekly, on August 31, 2020 - September 06, 2020.
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BUS transport company Gets Global Bhd could see businessman Low Bok Tek emerge as a substantial shareholder, sources familiar with the matter tell The Edge. “It is only a matter of time before he surfaces in the company,” says one of them.

Low was the controlling shareholder (29.3% stake) and CEO of glove maker Latexx Partners Bhd before the company was sold to Austria-based rubber and plastic products maker Semperit AG Holding in 2012.

To recap, Semperit made an offer that valued Latexx at RM603 million after securing 47.3% equity interest in the company from Low and eight other shareholders. Latexx was delisted in early June 2013.

Meanwhile, the share price of Gets Global has been rising. The stock reached a multi-year high of 58 sen in intra-day trade on Aug 27 from just 10 sen in the middle of the month. It closed at 40 sen last Thursday, giving the company a market capitalisation of RM49.77 million.

Low’s plans for Gets Global if he does emerge remain to be seen, but he is best known for Latexx and rubber gloves.

At Gets Global, controlling shareholder and managing director Datuk Che Azizuddin Che Ismail’s Arca Corp Sdn Bhd sold 30.24 million shares, or 24% equity interest, to Teong Lian Aik. Che Azizuddin still has 7.51 million shares, or a direct stake of 5.96%, in the company.

Teong — who was a substantial shareholder of Latexx until 2010 and a director of G Capital Bhd (formerly Gunung Capital Bhd) in 2008 — holds 40.16 million shares, or a 31.87% stake, in Gets Global, following a purchase of a block of shares from Arca Corp and another 9.92 million shares, or 7.87% equity interest, on the open market. G Capital, Gets Global and Latexx are linked via their shareholders.

Prior to Che Azizuddin’s taking-over of Gets Global in early 2016, the company was known as KBES Bhd (or Konsortium Bas Ekspres Semenanjung) and controlled by its then managing director Lau Chan Seng, who had a 30% stake. Lau, who is Low’s brother and a former managing director of G Capital, left in 1997 to set up Konsortium Bas Ekspres Semenanjung (M) Sdn Bhd, which then morphed into KBES and, later, Gets Global.

Low was CEO and controlling shareholder of G Capital, but ceased to be a substantial shareholder in October 2018. Until September 2010, G Capital was the latex commodity trading arm of Latexx, and Low controlled both companies.

Before G Capital entered the latex commodity trading business, it was known as Taiping Super Bhd, a bus company. It went back to being a bus transport company after September 2010. It now builds and operates mini-hydropower plants.

Low was also behind Neico Industries (M) Bhd in the late 1990s, which today is property developer I-Bhd.

Last Wednesday, in a reply to an Unusual Market Activity query by Bursa Malaysia, Gets Global said, “There has been an emergence of a new substantial shareholder, namely Teong Lian Aik, who holds an approximate 31.87% equity interest in Gets. Pursuant to his emergence as a new substantial shareholder of Gets, Teong, together with the management and auditers of Gets, has been evaluating/exploring the viable options available (that is, fundraising exercises) to address the group’s financial difficulties, where the auditers had also expressed a material uncertainty on the listed issuer’s ability to continue as a going concern in its latest audited financial statements.

“In addition, the aforesaid fundraising exercise is intended to improve the cash flow position of the company, particularly on the group’s default on the principal and interest payments amounting to approximately RM18 million for its borrowing as a result of its financial constraints.”

It is noteworthy that, according to announcements in June and July, Teong is also purchasing parcels of land held by Gets Global in Larut and Matang, Perak, for RM25 million.

For the nine months ended March, Gets Global had suffered a net loss of RM3.06 million from RM17.86 million in revenue. In the previous corresponding period, the company saw a net loss of RM4.81 million from RM19.31 million in sales.

As at end-March, Gets Global had cash holdings of just RM170,000. On the other side of the balance sheet, it had short-term borrowings of RM18.38 million but no long-term debt commitments. The company had accumulated losses of RM37.63 million, but had a net operating cash flow of RM2.28 million, for the three months ended March.

On its prospects, Get Global says, “The group is mindful of the various challenges facing the group, particularly related to the legal suits and outstanding dues to various parties. However, the group is cautiously optimistic that the efforts underway to improve the group’s finances covering both operational and financial perspectives will be able to strengthen and place the group on a stronger footing.

“The group foresees the bus transport industry will continue to remain relevant and with good growth prospects in line with the government’s National Transport Policy 2019-2030 to strengthen public transport in cities and urban areas and to promote the use of environmentally friendly vehicles, where the group is [currently] involved in the design and development of electric buses.”

 

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