Chin not selling Ingens stake (0034)

PETALING JAYA: Chin Boon Long, the man at the centre of the storm, has decided not to sell his stake in Ingenuity Solutions Bhd (Ingens), given his grand plans to synergise the company's operations with 1 Utopia Bhd.
Chin, the managing director of 1 Utopia Bhd, said in his own words, “Thanks but no thanks”, throwing a spanner in the works of Ninetology Marketing Sdn Bhd's
bid to take over Ingens by offering its substantial shareholders a
pricey 55 sen per share in order to trigger a mandatory offer for the
rest of the shares in the company.
“The offer is attractive but
if I would have to sell my stake to them, I would actually be giving 1
Utopia for free to them. There is no way I would sell. I want to
integrate the two companies by differentiating them as B2C
(business-to-customer) and B2B (business-to-business) businesses,” he
said in a press conference arranged on his own capacity.
Chin is the single-largest shareholder of 1 Utopia with a 12.85% stake or 86.15 million shares.
With
Ninetology's offer that has grabbed the attention of the investing
public, he said he believed that the parties were exerting public
pressure to make him sell his stake.
“It looks very friendly but in fact it's not really,” he said, adding that he knew Ninetology's chief executive officer Sean Ng for about two years as both had business ties, with Ng being a supplier to 1 Utopia when he was attached with Spice-CSL Group.
According
to Chin, he currently has 65.8 million shares, or a 12.11% stake, in
Ingens directly under his own name at an average cost of 11 sen, with
32% of the investment being margin-financed. He also holds an indirect
stake of 18.13% via Firstwide Success Sdn Bhd, in which he is a director, together with his wife Chan Swee Ying and Ingens chairman Datuk Feroz A.S. Moidunny.
“I
hope I can raise my stakes in Ingens but only if I have that much of
money to buy. My purchase of shares right now is heavily financed by
margin. If I take more, I will have to do a mandatory general offer and
I will go bankrupt,” he said.
On how he is going to answer the
margin call, Chin said he was sorting the issue out now and did not
discount the possibility of selling some of his assets and properties
to finance the share purchase.
He added that he would hold his
stake for a minimum of two years and was seeking to be immediately
elected on Ingens' board right after the press conference yesterday.
According
to Chin, 1 Utopia is in the midst of launching its lifestyle cashback
reward programme named Moola on Sept 13, which can leverage on Ingens'
network and ERP (Electronic Receipt Payment) system.
“The
rationale that I bought Ingens is because of the infrastructure in the
company. 1 Utopia cannot survive without the payment gateway. If the
payment terminals are all taken back immediately, we the retailers
would suffer.
“1 Utopia is my baby that I want to grow. If I
don't have 1 Utopia and still have Ingens shares, I will sell
straightaway without even considering,” he said.
Meanwhile, Ninetology's Ng expressed his surprise when contacted about Chin's decision.
“We
heard the news and I'm quite surprise at how fast Chin responded. With
his decision, we will move on to our Plan B which involves the
acquisition of two to three private companies that we don't need to
disclose publicly,” he said.