THE board of Tiger Synergy Bhd must swiftly address a string of concerns raised by shareholders before embarking on yet another round of fund raising.
Towards this end, Safari Alliance Sdn Bhd, a substantial shareholder of Tiger Synergy with a 10.89% stake, also urged both institutional and minority shareholders to demand clarification from its board on a series of financial transactions and developments conducted by the company recently.
The property developer will stage its virtual extraordinary general meeting (EGM) on July 29 (Thursday) at 11am.
Safari Alliance had on July 19 filed a lawsuit against Tiger Synergy and its board, namely Datuk Tan Wei Lian, Tan Lee Chin, Datin Sek Chian Nee, Datuk Khoo Seng Hock, Datuk Lee Yuen Fong, Low Boon Chin, Chua Eng Chin and Datin Sulizah A. Salam, in a bid to clarify material information as well as to declare the EGM notice null and void.
“One significant but questionable transaction was where around RM39.3 mil was advanced to an alleged contractor for pre-construction costs towards end-2019 and recorded as a receivable,” commented Safari Alliance’s director Goh Ching Mun.
“This type of payment was not within the represented intended use of funds for the fund raising conducted in 2018. Before the company can embark on yet another fund raising exercise, there should be full and frank disclosure as to why this sum was not collected.”
According to Goh, some of the clarifications shareholders should demand from the board include the status and updates of development projects announced by Tiger Synergy over the recent years, financial transactions made in relation to these projects as well as particulars and circumstances in which a sum of RM39.30 mil was paid to an alleged contractor.
“It makes no sense to continuously dilute the value of our shares through fund raising exercises while tangible developments said to be carried out by the company are nowhere in sight,” lamented Goh.
He also noted that Tiger Synergy had raised RM84 mil in new share issues during its financial year ended Dec 31, 2019.
“However, the company had nothing to show for it except for a RM9.3 mil loss for its 4Q FY2019,” Goh pointed out. “Its 2019 annual report also showed a hidden additional loss of RM10.2 mil treated as a prior year ‘error’. History must not repeat itself.”
Moreover, the absence of movement in the current property development cost from 2018 till now suggests money raised were not spent towards property development.
On July 14, Tiger Synergy proposed renounceable rights issue of up to 1,101,480,437 new ordinary shares in the company together with up to 1,101,480,437 free detachable warrants in the company (Warrants D) on the basis of three rights shares together with three free Warrants D for every four existing shares held by the entitled shareholders of the company.
This exercise is subject to shareholders approval at the said EGM.
At the close of today’s trading, Tiger Synergy was unchanged at 5.5 sen with 283,400 shares traded, thus valuing the company at RM81 mil. – July 27, 2021
