KUALA LUMPUR (May 16): Malaysian Bulk Carriers Bhd (Maybulk) has proposed to undertake an RM275 million capital reduction to eliminate its accumulated losses.

As at May 3, 2023 (the latest practicable date prior to this capital reduction announcement), the issued share capital of Maybulk was RM338.79 million comprising one billion shares.

The proposed capital reduction will result in its share capital being reduced to RM63.79 million from RM338.79 million, resulting in a capital reduction of RM275 million, which will be utilised to set off its accumulated losses of RM259.07 million at the company level, said Maybulk in a stock exchange filing.

Maybulk said the corporate exercise requires approvals including from shareholders via an extraordinary general meeting, as well as its creditors.

Kenanga Investment Bank has been appointed as the principal adviser to the proposed capital reduction exercise, which is estimated to be completed by the third quarter this year.

Currently, Datuk Goh Cheng Huat is the largest shareholder of Maybulk, with a 32% stake. He is also the managing director of the drybulk shipping company.

Goh is also the founder of two steel companies, namely Eonmetall Group Bhd and Leader Steel Holdings Bhd.

He emerged as Maybulk's substantial shareholder with a 16% stake in April last year, after tycoon Tan Sri Robert Kuok Hock Nien disposed of his 32% stake held via Pacific Carriers Ltd.

The remaining 16% stake that Kuok disposed of was purchased by Tunas Capital Sdn Bhd — the vehicle controlled by Datuk Chin Yoke Kan and Datuk Chin Yoke Choon.

However, both Yoke Choon and Yoke Kan disposed of their shares and exited from the board this year, following the plan to sell their grocery business to Maybulk having fallen through. The shares were acquired by Goh, making him the single largest shareholder of Maybulk.

Maybulk’s foray into the grocery business was announced in August last year, which aims to mitigate the risk of overdependence on its existing shipping business.

The plan was supposed to see Maybulk collaborating with the operator of a retail chain under the Tunas Manja Group (TMG). The TMG Mart chain is operated by Tunas Manja Sdn Bhd (TMSB).

Three months later in November, Maybulk called off its plan to diversify into the grocery retail business, when the company terminated a collaboration agreement it had with TMSB, citing conditions precedent of the relevant agreement having not been obtained by the cut-off date on Nov 14, 2022.

Shares of Maybulk closed unchanged at 31.5 sen on Tuesday (May 16), giving the group a market capitalisation of RM315 million.

Read also:
Robert Kuok’s Pacific Carriers ceases as Maybulk substantial shareholder
Maybulk diversifies into grocery business with RM54 mil investment
Maybulk aborts plan to diversify into grocery business
EonMetall founder tops up his stake in Maybulk, Chin brothers resign as EDs
Tunas Capital exits Maybulk as Eonmetall's Goh raises stake to 32%