Jaikishan exits Envair making RM750,000 in less than two weeks

  • Business
  • Friday, 23 Dec 2011

PETALING JAYA: Carpet Raya Sdn Bhd director Deepak Jaikishan has sold out of loss-making air and water filter manufacturer Envair Holding Bhd, less than two weeks after buying a 5.06% stake in the company, netting at least RM750,000 in the process.

He first bought the 5.06% stake, or six million shares, on Dec 2 at 22 sen per share.

Based on Envair's announcement to Bursa Malaysia on Wednesday, Jaikishan sold his stake on the open market on Dec 14 when the stock was traded at between 34.5 sen and 38 sen. Even if he had sold his shares at the lowest price of 34.5 sen, he would have made RM750,000.

On the same day, Chinese national Zhang LiYing also sold his 9.11% stake in Envair which he bought on Oct 13. The transaction was also done on the open market.

These sales follow the exit of another Chinese national, Jiang Chuan Yi, who disposed of his entire stake of 6.75% in Envair less than a month after acquiring it on Nov 1.

Jaikishan had earlier said he would not sell down his stake in Envair and instead, hoped to build it up in the future. He had also said in a statement on Dec 6 that he aimed to “be part of the thriving company's executive board and management”.

When contacted by StarBiz yesterday, Jaikishan said: “I sold my stake because I could not get the shareholding that I wanted, which was between 20% and 25%. It is no point without a larger stake.”

The 39-year-old businessman said discussions to buy more shares from other Envair substantial shareholders, whom he declined to identify, did not bear fruit as they could not agree on the pricing.

After being hardly traded for the past few years, Envair's stock suddenly surged in early October from 11 sen to 40 sen in early November, just before the company unveiled its plans to enter the oil and gas industry by supplying two million barrels of light crude oil monthly for 60 months to a China-based company, An Hong Shenzhen.

In the past three months, the stock has been on a volatile ride rising from 11 sen in October to over 40 sen in November. It ended yesterday at 26.5 sen.

The issue of rapid entrance and exit of shareholders in companies have raised much concern among the investing fraternity. Companies that have seen such happenings in recent months include Sanichi Technology Bhd and DVM Technology Bhd.

There was a similar episode involving Kenmark Industrial Co (M) Bhd last year. It made headlines after its key management and Taiwanese executive directors went missing, leaving the company in a fix. A week later, former director and tycoon Datuk Ishak Ismail emerged as a substantial shareholder but sold off his entire stake within two weeks for a profit.

The Securities Commission has since commenced civil proceedings against Ishak.

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