Scanwolf shareholders file suit to stop board from appointing new directors

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KUALA LUMPUR (May 22): Scanwolf Corporation Berhad (Scanwolf)’s three substantial shareholders had filed an originating summons and an ex-parte injunction application to stop the company and its nine directors from appointing new directors before the extraordinary general meeting(EGM) is held on June 17.

In a filing to Bursa Malaysia today, Scanwolf (fundamental:0.75; valuation:0.3) said the company has been served with an originating summons dated May 18, and notice of application (ex-parte) dated May 19, together with an affidavit in support for an injunction by Abdul Hamid Abdul Shukor, Cedric Wong King Ti and Yii Long Ging (the Plaintiffs).

The three had listed managing director Datuk Ch'ng Kong San, two executive directors — namely Datuk Tan Sin Keat and Soon Eng Kooi; plus five independent directors — Ong Sing Guan, Tan Weng Chuan, Teh Hock Leng and Umair @ Azura Zakaria and Loh Kai Kwong; and newly-appointed chairman Mak Hon Weng and Scanwolf, as defendants.

The plaintiffs had sought the court to grant an order to prohibit the nine directors through their employees, agents and nominees from appointing new directors for Scanwolf, pending disposal of the originating summons.

If any new director of Scanwolf is appointed by the nine directors or any of them as the directors of the company of Scanwolf after May 15 and before the disposal of the EGM on June 17, the plaintiffs also seek an order to prohibit the enforcement of the appointments, pending the disposal of the originating summons.

The three also seek the court to grant the costs in the cause and other reliefs that the Court may deem fit and appropriate.

“Today, the Court has fixed May 27 as the hearing date for the plaintiffs’ notice of application for an injunction.

“The company will be seeking legal advice from its lawyers,” it said.

The latest move was after they called for an EGM to sack the nine directors of the company and to appoint five new directors on May 14.

Scanwolf came into the limelight when a preliminary findings report from an investigative review on its operations, had revealed several “possible irregularities” in the company and some subsidiaries in the property development division.

On May 6, it told Bursa Malaysia that the report was the outcome of an investigative review conducted by PKF Covenant Sdn Bhd, which was appointed by Scanwolf’s board on April 23.

Among possible irregularities found, were several conflicts of interest due to undisclosed relationships between former directors of Scanwolf and Almal Development (M) Sdn Bhd (ADSB).

Scanwolf’s share closed unchanged at 76.5 sen today, giving it a market capitalisation of RM66.37 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.)