PETALING JAYA: Patimas Computers Bhd, once a darling technology stock on Bursa Malaysia, is on the verge of being delisted although a last ditch attempt is being made to save the company.
It is not clear if this attempt will succeed, which is possibly why the stock price of the company has plummeted to one sen per share.
To recap the recent events, Patimas, which had already fallen into PN17 status as far back as last November, has so far failed to submit its regularisation plans within the required 12 months since its PN17 status.
It had slipped into PN17 after its auditors had expressed a disclaimer of opinion regarding its financial statements for the period from Jan 1, 2011 to March 31, 2012. It had announced an audited net loss of RM86.5mil for that period.
Subsequently, the company appointed UHY Advisory (KL) Sdn Bhd to conduct an investigative audit into Patimas’ financial affairs following a police report lodged by its former audit committee chairman over unresolved significant accounting, audit findings and queries raised by Ernst & Young.
On Oct 28, 2013, Patimas had submitted an application for extension of time to submit its regularisation plan but this was rejected by Bursa Malaysia.
The reasons for the rejection are not clear but one view is that the exchange was not convinced that Patimas had in fact any substantial plan to take it out of its doldrums. Hence, as it stands now, Patimas shares will be suspended on Nov 27, and subsequently delisted on Nov 29.
However, Patimas has one last chance to stay listed, at least for now – that is to file an appeal against the recent rejection by Bursa Malaysia for the extension of time request.
Indications are that it will do so today. Fighting for the survival of Patimas is Steven Tan, who is the Malaysian representative of China Private Equity Investment Holdings Ltd, which had first emerged as a substantial shareholder of Patimas in January this year, with a 5.2% stake.
Tan has since become an executive director of Patimas.
“We are trying to save the company because we see potential in the data storage business. This is the one area of business within Patimas which we are bullish on,” he said. “We eventually see e-commerce from North Asia spilling over to South-East Asia.”
Tan is confident of turning Patimas around and hopes for it to remain a listed entity.
“We are appealing to Bursa to allow us an extension of the deadline to submit our regularisation plan. I only came in on Oct 17, and will need some time to implement our plan. Without the extension of the deadline, minority shareholders will lose out,” he said.
Tan added that should the appeal go through, there were ready investors who were willing to pump in capital to recapitalise the company.
However, the authorities are left with a tough decision in whether to allow this appeal, considering that Patimas has failed to regularise itself all this while.
As explained by one industry source: “The authorities will have to decide whether to keep this company listed. Sure, there are minorities who will lose out if the company is delisted. But at the same time, new investors in the company could be hurt if a company with little hope of resuscitation is allowed to remain listed.”
Patimas was founded by Datuk Yap Wee Hin in 1989. The other founding members are Robert Daniel Tan, Law Siew Ngoh and Datuk Ng Back Heang.
All three directors, save for Yap, collectively owned less than 1% of the company when the company went into turmoil by December 2012.
Tan and Yap also own Forum Pintar Sdn Bhd, which used to be the single largest shareholder of Patimas. Filings showed that as of April last year, Forum Pintar had a 20% stake in Patimas. This was significantly reduced to 5.88% by December 2012. In the same month, Forum Pintar ceased to be a substantial shareholder after its shares were forced-sold.
Another notable name that has surfaced in Patimas’ recent history is Datuk Seri Azim Zabidi, who first emerged as a substantial shareholder in January 2013 with 45 million shares, or a 5.4% stake. He subsequently raised his stake in March this year to 6.6%.
In January, he had put in a motion to replace Patimas’ entire board namely Tan, Law and Ng. He was looking to inject new blood in the form of UDA Holdings chairman Nur Jazlan Mohamed Rahmat.
Azim reportedly said that he was prepared to take control of the financially distressed company, which had to be rescued; otherwise it would face delisting.
On March 1, Azim and Jazlan were appointed as non-executive directors of Patimas.
Jazlan’s appointment was shortlived, as by April 18, he resigned due to him contesting as a candidate for GE13.
On March 29, Tan, Law and Ng resigned from the company.
Then on May 23, Azim ceased to be a substantial shareholder of the company after disposing 55 million shares.
On Oct 17, Steve Tan Sik Eek was appointed executive director of the company.
The other current directors of Patimas are Datuk Bahari Haron, who is chairman. Azim is still non-executive director. The independent directors consist of Chai Ko Thing, Wan Azmi Wan Abdul Rahman and Ong Tee Kein.
