Bursa Malaysia publicly reprimands, fines Brem Holdings directors

KUALA LUMPUR: Bursa Malaysia Securities Bhd has reprimanded and fined six directors of Brem Holding Bhd (BREM) for breaching the exchange's Main Market listing requirements (Main LR), the exchange said in a statement today.

Managing director Tan Sri Khoo Chai Kaa was fined RM200,000; executive director Khoo Chai Thiam who retired on Sept 20, 2018, was fined RM50,000 and executive director Low Yew Hwa, RM50,000.

Low was appointed as non-independent non-executive director on Aug 24, 1992 and re-designated to executive director on July 23, 2019.

The other three are independent non-executive director and audit committee chairman Wong Miow Song, who was fined RM50,000; non-independent non-executive director Khoo Hui Keam (RM50,000); and non-independent non-executive director audit committee member Khoo Hui Giok (RM50,000).

The six had failed to ensure that payments and advances on behalf of GJH Prestige Sdn Bhd (GJHP) from Aug 28, 2014 to Aug 22, 2019 totalling RM26.46 million were fair and reasonable to the BREM and its shareholders, breaching paragraph 8.23(2)(a)(i), which is read together paragraphs 8.23(1)(a)(ii) and (iii) of the listing requirements.

"The penalties on the directors were made pursuant to paragraph 16.19 (1)(b) of the Main LR on completion of due process and after taking into consideration all facts and circumstances of the matter and the impact of the breach to BREM and its shareholders or investors,” the statement said.

Bursa Malaysia viewed the contravention seriously as the requirements under paragraph 8.23 of the Main LR were one of the key investor protection requirements to ensure proper preservation and employment of a company’s assets or funds.

On Nov 1, 2014, BREM acquired 49 per cent of GJHP from GJH Holdings Sdn Bhd (GJHH).

However, it made advances to or on behalf of GJHP from Aug 28, 2014 to Aug 22, 2019, prior and subsequent to the acquisition of GJHP as an associate.

The statement said the board had failed to take proper reasonable care and make due diligence to make an informed assessment on the advances. There was also no documentation to formalise the transaction between BREM and GJHP/GJHH, nor the purposes of the advances.

The result was that by Aug 31, 2017, GJHP had only repaid RM1.6 million to BREM with remaining advances amounting to RM24.86 million still outstanding.

This outstanding amount represented 4.67% of the group’s net tangible assets (NTA) as at Mar 31, 2019 and 4.3% of the group’s NTA as at Mar 31, 2021, nearly eight years after BREM had first provided the advances.

Bursa Malaysia said although BREM had been de-listed, the breaches by the directors were committed while BREM was listed on the exchange. - Bernama

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