Muar Ban Lee Group Bhd (MBL) has yet to approach Federal International Holdings Bhd (FIHB) over its intentions to increase shareholding in the furniture manufacturing and construction company.
“We have not been approached by MBL, but the board is pleased that the market recognises the value proposition of FIHB,” managing director Choy Wai Hin told FocusM.
The Edge, citing sources, reported on June 17 that MBL had expressed interest in holding more than a 25% stake in FIHB.
The business publication went on to say that while it was puzzled as to MBL’s intention on enlarging its stake in FIHB “whose earnings performance has not been that outstanding,” being a substantial owner of the furniture-construction company may “make the existing controlling shareholder, the Choy family, uncomfortable with MBL.”
The Edge added that sources said MBL has already acquired more than a 5% direct stake in FIHB, “effectively making it a substantial shareholder in the furniture maker.”
The Choy family controls about 33% of FIHB, according to the company’s 2019 annual report, as well as holds 99% of FIHB’s redeemable convertible preference shares (RCPS A and B).
FIHB’s second-largest shareholder is Alan Voon Sze Lin. He owns a direct stake of 2% and an indirect stake of 4.91%. Voon, according to the latest Bursa filing, had disposed of 750,000 shares in FIHB on the open market.
FIHB is involved in four main business divisions: manufacturing, interior fitout, construction and trading. Some of its most notable clients include servicing Starbucks Corp accounts.
FIHB posted a slightly higher net profit RM2.28 mil for the second quarter ended Dec 31, 2019, compared to RM2.02 mil for the same period last year.
MBL is a Johor-based palm kernel oil expeller and crushing machinery manufacturer controlled by the Chua family. The company made headlines last year after it blocked the privatisation deal of Cycle & Carriage Bintang Bhd as it exercised its right as a minority shareholder.
FIHB shares trended 1.64% lower at 60 sen after the midday break on June 19 while MBL hovered around RM1.45, 0.69% higher after lunchtime. – June 19, 2020
