OVER the past few months, there have been several shareholding changes in little-known loss-making Milux Bhd.

Recently, the kitchen and electrical appliance manufacturer saw the emergence of a new largest shareholder — RGF Land Sdn Bhd, a private company — with a 13.8% stake.

RGF Land is equally owned by Revi Janardhanan Pillai and Chua Seong Seng. They are also the only two directors of the company.

“It’s unclear what’s going on, or who they are, or if they represent anyone, but their names have surfaced in at least two other companies, apart from Milux, since early this year,” a source says.

A check on the Companies Commission of Malaysia’s (CCM) website shows that RGF Land was registered in late January this year, and thus has no financial track record.

Its nature of business is stated as “activities of holding companies, construction of buildings, wholesale of a variety of goods without any particular specialisation”.

Koh Pee Seng, a familiar name in the local corporate scene, is the managing director of Milux (fundamental: 1.20; valuation: 0.30). He is also a substantial shareholder with a 7.4% stake. Other substantial shareholders include Datuk Mohamed Salleh Bajuri (9.9%), Yee Ying Sung (5.5%), Ang Lip Chee (5.2%) and Lim Kooi How (5.2%).

The emergence of new substantial shareholders raises the question of what has attracted them to invest in the loss-making manufacturer.

It is not known from whom Revi and Chua acquired the block of shares. A filing with Bursa Malaysia shows that the two, via RGF Land, bought six million shares or an 11% stake in off-market deals on May 12 and another 1.5 million shares or a 2.8% stake on June 2. Meanwhile, there has been no cessation of substantial shareholders in Milux.

According to Bloomberg data, the May 12 deals were done at RM1.20 a share while the 1.5 million shares on June 2 were crossed at RM1.18, which means that RGF Land paid just under RM9 million for the shares.

Milux’s earnings performance has not been impressive since FY2009. However, it is still in a net cash position of RM9.58 million or 17.6 sen per share.

For the first quarter ended March 31, 2015, the company posted a net loss of RM339,000 on revenue of RM18 million. Its net asset per share was 87 sen, largely made up of land and office buildings in Seberang Prai, Penang.

As at end-March 2015, Milux had a cash balance of RM12.4 million, short-term borrowings of RM2.6 million and long-term debt commitments of RM212,000.

The company’s shares hit a 52-week low of 90 sen on March 19. The stock closed last Thursday at RM1.06.

A closer look at the new shareholders reveals that Chua is affiliated to Dutama Properties Sdn Bhd, where he is the principal. But a check on CCM’s website indicates that he is neither a shareholder nor a director of the real estate outfit.

A check on Bloomberg reveals that Chua and Revi also surfaced in Imperial Plantation Corp, a small company with a market capitalisation of US$8 million (RM29.9 million). According to Bloomberg, Revi is the CEO while Chua, who is listed as having “Robbie” as a first name, is the chief financial officer.

Imperial Plantation is a development-stage company engaged in the acquisition of various gold properties. Formerly known as ProVest Global Inc, the company just changed its name last month.

Imperial Plantation is based in Las Vegas, Nevada. Judging by reports, Chua and Revi would have taken control of the company either in January or February.

Imperial Plantation incurred a net loss of US$72,906 for the nine months ended January 2015, with no revenue, indicating that it did not have any business.

Interestingly the two, through RGF Land, have also acquired 188.5 million shares or an 11.7% stake in Australia-listed Citigold Corp Ltd from LionGold Corp Ltd, a company which was in the headlines for all the wrong reasons. The transaction took place on May 29.

LionGold and a clutch of Singaporean companies were investigated for trading irregularities in 2013. The collapse of the share prices of LionGold, Blumont Group Ltd and Asiasons Capital Ltd in October 2013 resulted in some S$8 billion in market value being wiped out in just a couple of trading days.

Citigold is a gold mining and exploration company that controls the Charters Towers goldfield in north-east Australia and over 1,000 sq km of exploration area with identified targets for major discoveries.

Citigold had previously estimated the goldfield to hold mineral resource of 28 million tonnes containing 11 million ounces of gold.

What Chua and Revi’s plans are for these companies — Milux, Imperial Plantation and Citigold — remains to be seen, but nevertheless could generate interest in the near term.

Note: The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations. Visit www.theedgemarkets.com for more details on a company’s financial dashboard.

This article first appeared in The Edge Malaysia Weekly, on June 15 - 21, 2015.

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