KUALA LUMPUR (Nov 21): While a majority of Apex Equity Holdings Bhd shareholders had given a second nod to merge its stockbroking arm JF Apex Securities Bhd with Mercury Securities Sdn Bhd on Monday, however it appears that there could still be stumbling blocks that Apex need to clear in order to complete the merger.

In a filing with Bursa Malaysia yesterday, Apex Equity said the Court of Appeal has adjourned the hearing to grant the vesting order, which was fixed on Wednesday. And it has fixed the hearing date on Dec 10.

The court, however, has also directed Pinerains Sdn Bhd to file their affidavit in opposition to the vesting application order by Dec 4, 2019.

For perspective, the vesting order is the last condition precedent to be fulfilled to execute the merger between the two stockbroking firms.  

The hearing was adjourned simply because of an on-going court case, in which minority shareholder Concrete Parade Sdn Bhd wants to invalidate the business merger agreement that has been signed by Apex Equity and Mercury Securities.

In a separate filing with Bursa, Apex said the Court of Appeal has allowed Concrete Parade’s Notice of Motion to restrain JF Apex and Mercury Securities from proceeding with the vesting order application (OS 345) and or commencing the vesting order in pursuant with the business merger agreement, pending the disposal of the appeal (Appeal 1551) seeking to dismiss the proposed merger.

On Aug 7, the High Court of Malaya dismissed an application (OS 56) filed by Concrete Parade seeking amongst others, to invalidate the business merger agreement for the proposed merger. Concrete Parade, subsequently, filed an appeal against this dismissal.

The Court of Appeal had fixed a hearing of the appeal on Dec 3, 2019.

To recap, a resolution on the merger was tabled at Apex Equity’s first EGM on June 19, with shareholders holding 54.8% or 100.85 million shares, voting in favour while the remaining 45.2% with 83.19 million shares voted against it.

However, the resolution was invalidated by the High Court on Sept 18, following the intervention of Pinerains Sdn Bhd — a minority shareholder of Apex Equity with a 4.17% stake — against the vesting order application by Apex Equity to proceed with the merger.

Apex opted to convey a second EGM to seek shareholders' approval instead of appealing against the court’s decision. On Monday, a majority of Apex shareholders passed the resolution on proposed merger.

Shares of Apex Equity were untraded today. It last closed unchanged at 83 sen, valuing the company at RM167.18 million.