AT LEAST two individuals with clear ties to corporate player Tan Sri Robert Tan Hua Choon have surfaced in ailing Central Industrial Corp Bhd (CIC), controlling a sizeable chunk of the company’s shares.
They are Tan Ban Aik, who has 3.7 million shares or close to 8% in CIC (fundamental: 1.80; valuation: 1.20), and Gan Lock [email protected] Choon Hur with 4.6 million shares or 10%. The two, with another individual Mokhtar Abdullah, who controls 6.4 million shares or a 14% stake, acquired the blocks of shares, totalling 31.9% of CIC, from Skim Amanah Saham Bumiputera, a unit of Permodalan Nasional Bhd, at 90 sen apiece via off-market trades on May 6. At that price, the stakes, amounting to 14.6 million shares, would have cost them RM13.1 million in total.
“We hear that all three are connected to Robert Tan in one way or another, but it is not clear if he will surface or remain in the shadows,” says a source.
However, The Edge could only establish ties between Tan, Gan and Ban Aik, as any ties with Mokhtar remain uncertain.
Channel checks reveal that Gan is an executive director of GPA Holdings Bhd, which is controlled by Tan, and has been with the company for the past 15 years. Before that, Gan had been with Jasa Kita Bhd — another counter linked to Tan — from 1983.
Gan also has a 5.6% stake in FCW Holdings Bhd and 4.7% in Computer Forms (M) Bhd, both of which are also controlled by Tan.
Ban Aik, meanwhile, has been linked to deals involving some of Tan’s companies.
In late March, a company controlled by Tan, Goh Ban Huat Bhd, had acquired 20.2% of Time Galerie (M) Sdn Bhd for RM14.2 million from several individuals. Among them was Gan, who was a director and had 20% equity interest in Time Galerie, and Ban Aik, who had 30% of the company.
Apart from Ban Aik and How Yoke Kam, four other shareholders and the two directors of Time Galerie are linked to Tan and have seats on the boards of many of his publicly traded companies.
Back in 2004, Ban Aik was listed as a 15% shareholder of Aspirasi Ratna Sdn Bhd, a company which property firm Nasaland Sdn Bhd bought from Malton Bhd. Malton is controlled by Tan Sri Desmond Lim Siew Choon, who is married to Puan Sri Cindy Tan Kewi Yoon, who is Tan’s sister.
Some publicly traded companies that have been linked to Tan include his flagship Jasa Kita, FCW, GPA Holdings, Goh Ban Huat, PDZ Holdings Bhd, Malaysia Aica Bhd, Keladi Maju Bhd, Marco Holdings Bhd and United Bintang Bhd.
However, he has since hived off PDZ and Malaysia Aica — now renamed Sunsuria Bhd — and market talk is that some of his other counters are also up for grabs.
Tan also controls privately held auto fleet management solutions provider Spanco Sdn Bhd, which leases out vehicles to the government on a 25-year agreement that expires in December 2018.
With Skim Amanah Saham Bumiputera exiting CIC, the single largest shareholder is now Malar Segar Sdn Bhd — the vehicle of Datuk Lim Chee Ming — which has a 26.7% stake.
Lim is known as the controlling shareholder of water player Taliworks Corp Bhd, in which he has a 55.4% stake.
Whether Lim and Tan are planning anything together remains to be seen.
Another substantial shareholder in CIC is BNP Paribas Wealth Management Singapore, which holds about 13% for a client.
Any plans Tan may have for CIC is anyone’s guess. The company’s mainstay — the manufacturing of self-adhesive tapes and trade labels — has not been doing well.
Over the last five financial years, CIC’s financials ranged from a net loss of RM3.1 million in FY2012 to a net profit of RM2.3 million in FY2010.
In FY2014, CIC suffered a net loss of RM1 million from RM59.1 million in revenue. As at Dec 31, 2014, its net asset per share was pegged at RM1.24.
As at end-December last year, the company had cash and bank balances of almost RM4.3 million, but very little in borrowings.
Its main assets seem to be eight acres of land in Kuala Muda, Kedah, with a net book value of RM9.6 million. The valuation was carried out 14 years ago in 2001. The land houses the company’s factory.
Other assets include office blocks in Plaza Dwitasik, Bandar Seri Permaisuri, Cheras, which had a net book value of almost RM2 million as at 2006.
CIC’s stock ended trading last Friday at 0.89 sen, giving it a market capitalisation of RM40.5 million.
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 May 18 - 24, 2015.