AGM Watch: Has Datasonic overspent on share buyback?

THE Minority Shareholder Watch Group (MSWG) is seeking clarification from Datasonic Group Bhd over the company’s high treasury shareholding.

During its FY3/2021, the company purchased 16.74 million of its issued ordinary shares from the open market at an average price of 68 sen/share or about RM11.4 mil including transaction costs.

This brings Datasonic’s total treasury shareholding to 77.2 million out of its 2.7 billion issued and fully paid-up ordinary shares or approximately RM37.6 mil as of March 31, 2021.

“What was the rationale for the share buyback during the financial year given that the group’s excess cash can be used towards re-investing in the business itself to facilitate growth, repayment of borrowings or to distribute cash dividends to shareholders instead of acquiring the company’s shares in the open market?” queried the shareholder activism group.

“What is the company’s plan for the 77.2 million treasury shares held?”

Datasonic is scheduled to stage its virtual annual general meeting (AGM) on Sept 15 (Wednesday) at 10am via the online meeting platform hosted by SS E Solutions Sdn Bhd.

Meanwhile, MSWG has also enquired from Malaysia Airport Holdings Bhd (MAHB) the future of Subang Airport given the potential of the airport operator losing up to RM11.9 bil in future revenue if it loses Subang Airport (the potential financial losses are calculated based on the remainder of the Subang Airport concession until 2069).

Recall that on May 18, FocusM reported that despite objections from various quarters, WCT Holdings Bhd’s wholly owned unit is still keen to acquire Subang Airport and that it has completed a full proposal to be delivered to the Transport Ministry soon.

“Is there a possibility of Subang Airport being carved out from the current operating agreement with the Government? If so, what will be the loss to MAHB as a result of this carve-out?” asked MSWG.

“What is the latest development on this issue? What actions have been taken by the company to-date?”

MAHB will stage its fully virtual 22nd AGM on Sept 13 (Monday) at 11am through live streaming and remote participation and electronic voting facilities hosted by SS E Solutions Sdn Bhd. – Sept 10, 2021

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