The chain of events surrounding this stock is truly incredible (but I wonder how many would even care and how many realise that this stock even exist),
On 13th March 2012: New major shareholder for HLS after unit sale?
- New major shareholder for HLS after unit sale?
Written by Cindy Yeap
Tuesday, 13 March 2012 11:41
KUALA LUMPUR: Loss-making Hock Lok Siew Corp Bhd (HLS) saw over 20.4 million shares, equivalent to 22.4% equity interest, traded on the open market yesterday. This may signal the emergence of a new substantial shareholder in the property firm whose market capitalisation is less than RM15 million.
The buyer and sellers were unknown at press time. Only its largest shareholder, Hock Lok Siew Realty Sdn Bhd, controlled by HLS’ chairman Ooi Chieng Sim, has a stake bigger than 20 million shares. Apart from the 29.4% indirect holding, Ooi directly owned another 2.9 million shares or a 3.19% stake as at May 11, 2011, according to HLS’ 2010 annual report.
Yesterday’s jump in trading volume also followed a holdings selldown of HLS’ second largest shareholder, A1 Capital Sdn Bhd, which last Friday ceased to be a substantial shareholder after selling 4.05 million shares in HLS, according to a filing yesterday.
A1 Capital last Friday also bought a 60% stake in HLS’ wholly-owned subsidiary, HLS Properties Sdn Bhd (HLSProp), a separate filing showed. HLS sold 60% of HLSProp to A1 Capital for RM2.6 million, a deal expected to result in a RM60,000 one-time gain, it said in a statement last Friday. The price took into consideration HLSProp’s net assets of RM4.3 million as at Feb 29, 2012. HLSProp’s principal asset was a 2,570 sq m tract of land in Bandar Jelutong, Penang.
“As the company (HLS) is currently engaged in a pending litigation with Malayan Banking Bhd, the group is unable to raise sufficient funds to develop the piece of land belonging to HLSProp. Due to tight cash flow at the present moment, the group has rationalised that raising capital via disposal of shares in HLSProp is a viable and logical expansion strategy,” HLS said in the statement last Friday, adding that applications have been submitted to obtain planning approval for the development of the land.
The disposal, which is not subject to shareholders approval, is expected to complete in September 2012, it said.
On the open market yesterday, HLS shares changed hands for 13.5 sen to 17.5 sen before closing at 14.5 sen, down 9.4% for the day. That is just below its unaudited net assets per share of 14.7 sen as at Dec 31, 2011. HLS made a RM1.56 million net loss on the back of RM10.61 million turnover for FY11 ended Dec 31.
Last Friday, HLS saw 7.4 million shares change hands at 14 to 16 sen apiece before closing at its intra-day high.
A hardly traded counter, the last time HLS saw this much trading volume was in late September 2009. Filings show that on Sept 30, 2009, Datuk Ng Aik Kee ceased to be a substantial shareholder after selling 6.5 million shares for prices between 32.5 sen and 38 sen on the open market.
This article appeared in The Edge Financial Daily, March 13, 2012.
- Hock Lok Siew chairman and MD resigns
Written by Cindy Yeap
Friday, 16 March 2012 10:20
KUALA LUMPUR: Ooi Chieng Sim, 42, has resigned as Hock Lok Siew Corp Bhd (HLS) chairman and managing director on the advice of his family and personal doctor, casting yet another question mark on the fate of the company.
“His reason for the resignation is due to pressure and stress arising from the court case with Malayan Banking Bhd in relation to the corporate guarantee amounting to RM31.26 million,” said a company statement to Bursa Malaysia yesterday.
A new chairman and managing director has not been named at press time. The company’s market capitalisation stands at RM10.92 million currently.
On Monday, the company saw 20.4 million shares or 22.4% done on the open market. Only its largest shareholder, Hock Lok Siew Realty Sdn Bhd, controlled by Ooi, has a stake bigger than 20 million shares. Apart from the 29.4% indirect holding, Ooi owns another 2.9 million shares or 3.19% stake directly as at May 11, 2011, according to HLS’ 2010 annual report.
The sudden jump in trading volume last Monday followed a selldown by HLS’ second largest shareholder, A1 Capital Sdn Bhd, which on March 9 ceased to be a substantial shareholder after selling 4.05 million shares.
A1 Capital on March 9 bought a 60% stake in HLS’ wholly-owned subsidiary, HLS Properties Sdn Bhd (HLSProp), a separate filing showed. HLS sold 60% of HLSProp to A1 Capital for RM2.6 million, a deal expected to result in a RM60,000 one-time gain, it said in a statement last Friday. The price took into consideration HLSProp’s net asset of RM4.3 million as at Feb 29, 2012. HLSProp’s principal asset is a 2,570-sq m land in Bandar Jelutong, Penang.
In response to a Bursa Malaysia query on Wednesday, HLS said A1 Capital still has 3.78 million shares or 4.15% of the company following its share sale last Friday, though no longer considered a substantial shareholder. Kwan Seong Kee controls 90% of A1 Capital while the balance is owned by Ng Chin Nam.
On the HLSProp stake sale, HLS said the estimated construction cost of the Penang land is RM25 million and its 40% stake in HLSProp will be further diluted if it fails to pay up its portion of the cost.
“No valuation was carried out on the [Penang] land. However, the indicative value of the land as provided by valuers, Henry Butcher and Azmi & Co Sdn Bhd, is in the range of RM3.1 million to RM3.25 million,” read the reply on Wednesday.
For FY10 ended Dec 31, HLSProp recorded a net loss of RM104,510, had RM652,772 in net assets, and its net book value stood at RM3.26 million.
HLS shares changed hands between 11.5 sen and 13 sen yesterday before closing at 12 sen, down 11.1% for the day. That reflected 0.82 times its unaudited net asset per share of 14.7 sen as at Dec 31. HLS made a RM1.56 million net loss on RM10.61 million in turnover for FY11.
This article appeared in The Edge Financial Daily, March 16, 2012.
- Hock Lok Siew tumbles 26% to lowest since Aug 2000 IPO Written by Chong Jin Hun of theedgemalaysia.com
Wednesday, 18 April 2012 15:08
KUALA LUMPUR (April 18) : Shares of Hock Lok Siew Corp Bhd (HLS) fell 26% to the stock’s lowest since the audio speaker manufacturer’s listing in August 2000. This follows news that its wholly-owned subsidiary Foremost Audio Sdn Bhd (FASB) has defaulted on RM5.51 million worth of debt obligations.
HLS declined 2.5 sen to seven sen on Wednesday morning before rising to nine sen at 2.58pm with some 4.1 million shares done. The company’s initial public offering had involved 7.8 million shares at RM1.70 each.
HLS said it had on Tuesday received a default notice from CIMB Bank Bhd which plans to take legal action against HLS to recover the outstanding loans. HLS said should CIMB succeeds in its legal action, FASB will be liquidated, and accordingly, HLS will become a Practice Note 17 entity.
The borrower said it will be able to fulfill its debt obligation provided that the audio speaker manufacturer is able to negotiate for a debt-settlement scheme with its lender in the next 12 months.
- Hock Lok Siew tumbles after loan default
Written by Financial Daily
Thursday, 19 April 2012 15:26
KUALA LUMPUR: Hock Lok Siew Corp Bhd’s (HLS) share price tumbled 26% in the morning session of trading yesterday, to a historical low of seven sen, amid worries that the speaker manufacturer would fall into the Practice Note 17 category for cash-strapped companies. The counter recouped some losses later in the day to close at nine sen.
HLS’s share price has tumbled nearly 42% YTD and its market capitalisation is barely RM8.2 million.
The selldown came after the speaker manufacturer announced that its wholly owned unit Foremost Audio Sdn Bhd (FASB) had defaulted on RM5.51 million worth of debt obligations.
In an announcement to Bursa Malaysia, HLS said FASB had received a default notice for the payment of principal and interest in respect of banking facilities granted by CIMB Bank Bhd. The total amount outstanding is more than 5% of the consolidated net assets of the company.
HLS said the bank had indicated that it would take legal action against all the liable parties to recover the outstanding amount.
“If the creditor bank succeeds in its action against FASB, a receiver and manager will be appointed to FASB. Accordingly, HLS will fall into Practice Note 17 as it will no longer have business activity,” the company said in its announcement.
However, the board of directors said they are of the view that HLS is “solvent and will be able to repay all of its debts, as and when they fall due in the next 12 months.”
A corporate adviser said that under the circumstances, the banks might have to take a haircut or undertake a debt-to-equity scheme to recover the defaulted loans.
Last month, HLS chairman and managing director Ooi Chieng Sim, 42, resigned from the two positions on the advice of his family and personal doctor.
His reason is the pressure and stress arising from the court case with Malayan Banking Bhd over a corporate guarantee amounting to RM31.26 million.
The substantial shareholder of HLS is Hock Lok Siew Realty Sdn Bhd with 29.44% equity interest, followed by A1 Capital Sdn Bhd with an 8.6% stake. Ooi owns 3.19% equity interest in the company.
The company has been loss-making for the past three years. It incurred a net loss of RM1.56 million for FY11 ended Dec 31, compared with a RM940,000 loss for FY10. Revenue halved to RM10.6 million from RM21.2 million in FY10.
This article appeared in The Edge Financial Daily, April 19, 2012.
- HLS Corp now a PN17 company
Written by Surin Murugiah of theedgemalaysia.com
Wednesday, 02 May 2012 19:08
KUALA LUMPUR (May 2): Hock Lok Siew Corporation Bhd said on Wednesday that it has been designated a Practice Note 17 company after triggering the prescribed criterias of the Listing Rules.
The company said that on April 4 this year, Malayan Banking Berhad's (MBB) claim of about RM18million against the company based on the corporate guarantees provided by the company has been allowed and that it had proceeded to file a notice of appeal to the Court of Appeal against that decision and an application for stay of execution of the judgement sum by MBB.
HSL said its external auditors had provided a matter of emphasis on the audited financial statements of the dompany for the year ended Dec 31, 2011 highlighting the negative shareholders' equity position of the Group and of the Company of RM8.12 million and RM14.14 million respectively.
“Consequently, the Company has triggered the Prescribed Criterias 2.1(a) and (e) of PN17 of the Main Market LR,” it said.
There will be a lot of delicious food being served tomorrow.
ReplyDeleteI hope you could enjoy them too....
Hock Lock Siew was supposed to be the next Berkshire Hathaway. LOL!
ReplyDelete