Scanwolf to hog the limelight

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KUALA LUMPUR: Scanwolf Corp Bhd may step into the limelight, as its boardroom tussle could intensify in its extraordinary general meeting (EGM) tomorrow, while a full report by advisory firm PKF Covenant Sdn Bhd on the investigative review of its property developments is expected to be ready soon.

The EGM is conveyed by three shareholders wanting to remove the existing eight directors.

The full review by PKF Covenant is expected to be completed this week. The investigative review of the property development operation was initiated by the board about two months back, on grounds that there were “insufficient measures, severe discrepancies and possible irregularities” in the implementation of the development projects.

According to PKF Covenant’s preliminary report, eight possible irregularities have been identified in the company and its subsidiaries in the property development division.

The Ipoh-based home and kitchen fittings manufacturer ventured into property development in 2011.

Executive director Datuk Tan Sin Keat and the company’s financial controller, Ng Chee Wai, were suspended on June 2, pending a full investigation into discrepancies in supporting documents, such as invoices and delivery orders that have been submitted to the bank to withdraw a banking facility of Scanwolf’s subsidiaries.

Loss-making Scanwolf (fundamental: 0.55; valuation: 0.30) stepped into the limelight in April. Three substantial shareholders, namely Yii Long Ging, Cedric Wong King Ti and Abdul Hamid Abdul Shukor, wanted to oust three directors, including managing director Datuk Ch’ng Kong San.

However, the meeting was cancelled two days before, as a little-known individual, Yeoh Kean Beng, filed a suit on May 7 to restrain Scanwolf from holding the EGM, which was subsequently granted by the court on May 11, with no reason given.

On May 14, Yii, Wong and Abdul Hamid made a second attempt to call for another EGM. The move made was even harsher and more severe, as they sought to remove all nine directors of Scanwolf, replacing them with another five directors.

Moreover, it appears that the trio has also built a safety net by filing a suit against all the directors and Scanwolf itself, with an injunction to prohibit them from appointing new directors for the company until tomorrow.

The high court judge yesterday granted an order in favour of the plaintiffs.

Barring any last-minute changes, the EGM should be held tomorrow.

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This article first appeared in The Edge Financial Daily, on June 16, 2015.