Highlight Two Benalec exec directors sacked

by **Cals** Wed 09 Oct 2013, 09:28

Highlight Two Benalec exec directors sacked

Business & Markets 2013

Written by Esther Lee of theedgemalaysia.com

Wednesday, 09 October 2013 08:58

KUALA LUMPUR: Two executive directors of Benalec Holdings Bhd, Datuk Leaw Tua Choon and Datuk Leaw Ah Chye, have had their services terminated for breaching the terms and conditions of their respective service agreements.

The company said yesterday the duo, who are also substantial shareholders, would not have duties or powers under their purview. However, they remain as directors of the company.

In an announcement to Bursa Malaysia on Monday, the land reclamation company said it was terminating the service agreements of the two executive directors, with effect from that day.

“Benalec’s board is convinced that the above decision will not have any negative impact on the business and operations of the group,” it said in its announcement.

Yesterday, the company revealed that the two directors had breached the terms and conditions of their respective service agreements with Benalec. At a meeting on Monday, the company’s board of directors resolved to terminate their services with immediate effect.

Benalac also said yesterday that its board was currently seeking advice from the company’s legal counsel and corporate advisor in relation to the form, content and extent of any matters that need to be brought to the attention of the shareholders. “Upon receiving the said advice from the said parties, the board shall make the requisite announcement to Bursa Malaysia,” it said.

Tua Choon and Ah Chye are the brothers of Benalec group managing director Datuk Leaw Seng Hai. The three Leaw brothers and Foo Polin, together, hold a 53.21% stake in Benalec through their private vehicle, Oceancove Sdn Bhd.

Based on the company’s 2012 annual report, Tua Choon was heading the company’s reclamation works in Melaka. It had already reclaimed a total of 564 acres while another 1,050 acres of reclamation works is in progress.

Ah Chye, meanwhile, was overseeing the group’s ship repair division.

However, Benalec’s share price did not react to the news of the executive directors’ dismissal yesterday. The stock dropped barely one sen to RM1.17. Nonetheless, Benalec’s share price had been on a declining trend since early June this year. The counter declined 24.5% from RM1.55 on June 4.

For the financial year ended June 30, 2013 (FY13), Benalac’s net profit fell almost one-third to RM56.02 million from RM82.67 million a year ago. The group’s revenue was 8% lower at RM265.84 million. Benalec attributed the decline in revenue in FY13 to the fewer land sale transactions recognised for the year.

Its marine CONSTRUCTION [] segment, which is involved in reclamation works and land disposal, was the only profitable segment for FY13, raking in net profit of RM84.6 million. Meanwhile, its shipbuilding, vessel chartering and other segments suffered losses.

This article first appeared in The Edge Financial Daily, on October 9, 2013.