KUALA LUMPUR (Oct 12): KNM Group Bhd and its indirect wholly owned subsidiaries Deutsche KNM GMBH and Borsig GMBH have sued Flavio Porro and Terence Tan Koon Ping, after KNM called off the disposal of Borsig to Vorsprung Industries GMBH for €220.8 million (RM1.107 billion) in December 2022.

In a Bursa Malaysia filing on Thursday, KNM said the plaintiffs filed the writ action against the duo, who were former executive directors (EDs) of the group, at the Kuala Lumpur High Court on Wednesday (Oct 11).

The plaintiffs are seeking for the defendants to pay €3.44 million (RM17.26 million, based on a conversion rate of RM5.01 to €1), or any other sum determined by the court, within 14 days of the date of the order.

In the event that the defendants fail to pay up, the plaintiffs are seeking for their assets and properties to be traced and paid to them, in lieu of the amount initially sought.

They are also seeking general damages to be assessed, exemplary and aggravated damages, and a post-judgement interest rate of 5% per annum on the total sum awarded by the court from the date of judgement until the amount is settled in full, among others.

Porro is also part of a group of individuals who have been proposed to replace the current board of directors, which includes the company’s largest shareholder and chairman Tunku Datuk Yaacob Khyra, who holds a 9.5% indirect stake or 384.2 million shares held via Melewar Industrial Group Bhd.

An extraordinary general meeting to replace the directors was applied for by German billionaire Andreas Heeschen, who had recently upped his stake in KNM to 8.249%, following the acquisition of a further 13.6 million shares or a 0.336% stake in the open market.

"The matter is now fixed for case management on Oct 25, 2023," the filing stated.

On Monday (Oct 9), MAA Group Bhd, which holds an 8.55% equity stake in KNM, expressed its concerns over Porro’s candidacy to replace KNM's current board.

MAA, a flagship of Yaacob, claimed that Porro was the ED of KNM when the group defaulted on Thai bonds of 2.78 billion baht (RM354 million) on Nov 18, 2021.

At 2.33pm, KNM, which was among the top active stocks, rose half a sen or 4.55% to 11.5 sen, giving the group a market capitalisation RM465.28 million. The stock has declined by 34.29% in the past five days.

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