5 October 2016 - Construction and road maintenance company Protasco Bhd on 27 September 2016 through RHB Investment Bank announced bonus issue of 84,962,172 new ordinary shares of RM0.50 each in Protasco, to be credited as fully paid-up on the basis of one bonus shares for every four existing Protasco shares held on the entitlement date to be determined later.

The company told Bursa on behalf of the Board, RHB Investment Bank announce that they have today submitted an application to Bursa Securities for the listing of the Bonus Shares on the Main Market of Bursa Securities.

Secret Bonus-in-a-rush ahead of MACC probe into JKR?

There are lack of news coverage on the bonus shares issuance, as apposed to Protasco self-made owner, Chong Ket Pen media manipulation modus operandi. Investors are waiting for the supposedly good news of bonus issue entitlement.

Coincidentally, Protasco Bhd which majority of the company business coming from Public Works Department (JKR) contracts, is under spot light when JKR officers are one by one haul in to the Malaysian Anti-Corruption Commission (MACC) for criminal investigation involving graft or ill-gotten bribery money in hundreds of millions Ringgit. If Protasco Bhd is to be investigated, this could be one of the county largest publicly listed money laundering factory in Malaysia history.

The recent 24 August 2016 probe of JKR officers in Melaka, followed by 5 October 2016 probe of Sabah RM3.3 billion ill-gotten bribery money with RM114 million cash found in 3 government officers possession, could be just the tip of iceberg. 13 called in MACC graft probe involving Datuk and Datuk Seri, were reported in the August 2016 operation, as part of the on-going probe.

If the series of probe on civil servants turn "businessman" using ill-gotten money taken from the people of Malaysia is just starter plate or news teaser, market is concerned the largest JKR contractor, Protasco Bhd, where the largest governance issue is the board of directors, especially the substantial shareholders which facilitated the ill-gotten graft money laundering, would be MACC next target.

The most controversial of all is the founder cum once a minority shareholder of Protasco Bhd, happened to be a Dato Sri, and coincidentally was a JKR civil servant before magically turns his minority shareholding of 15% shares on Protasco Bhd as of June 2012, into Hundred-Million-Ringgit 24% major shareholder in less than 2 years. If added the indirect nominees and proxies, Chong would have purchased up to 40% of Protasco during the period. "The magician suddenly churn money out of thin air, through nominees and himself buying up Protasco shares and became major shareholder, is too good to be true. These are typical red flag for MACC.", commented a civil servant familiar with the issues. "Chong later self proclaimed owner of Protasco Bhd, as if the former owners counting Tun Daim don’t exist, is another red flag similar to the sudden rise of asset rich "self proclaimed businessman" in Sabah having a civil servant brother in higher place. Chong JKR civil servant trail matches the profile", added the officer. 

June 2012 happens to be the month Dato Sri Chong Ket Pen was removed from his Executive Director post in Protasco as per Bursa Malaysia announcement, and later through changes of new substantial shareholders that saved him his current post in Protasco. Subsequently some controversial corporate drama was manufactured to ousted Protasco substantial shareholders, followed by Chong's control of Protasco. Chong's actual goal of controlling the company is apparent. "If his money is came from ill-gotten graft money laundering machine Protasco, means his assets and Protasco itself belongs to the people of Malaysia. Also means if you own Protasco shares, you are indebting and owing people of Malaysia for the money taken through this money laundering shop traced back to ten years ago. It's that simple and straight forward", added the officer.

The culture of certain civil servant in one of the most corrupted institution seems to cross over and repeat its culture in Malaysia business world like virus, by breeding champion in graft and master mind of white collar crime.

Cash Run & Liquidation - Dividend, Cash Call, Bonus Issue all-in-one go?

Protasco Bhd seems to be rushing for some deadlines - with bogus dividend to the substantial shareholders at the expense of diminishing cash flow; announcement of share placement to raise cash at the same time giving out dividend in a rush; report of profits with ballooning questionable expenses; and latest share price manipulation with a rush for bonus issue to facilitate some substantial shareholder to artificially enjoy paper value gain and exit in market by share price manipulation.

According to company quarterly report to Bursa Malaysia, the company as of June 2016, having less than RM32.9mil cash in hand, compared to RM63.1mil cash in hand on June 2015, suggest that the burn rate might be too fast to be justified and may have cash stress for next 2 quarters. The profit simply doesn't match the cash flow, and rush of series of dividend, private placement and bonus issue seems to pointing to potential accounting manipulation, or to facilitate some sort of cash run, or escape from some sort of bigger conspiracy, such as authority probe.

If the MACC recent probe is to convince the people of Malaysia they are "serious for business", the Sabah probe is by far the biggest record in Malaysia history in terms of scope and monetary amount being confiscated, there should be more to come. Would the record be broken sooner with bigger whales in the other part of the country be captured? Market consensus suggest that JKR single largest "partner" and semi-monopoly "cooperation" with Protasco Bhd is indeed needed to rush for bonus issue in case billion Ringgit probe wipe off most of the company reserves, is alarming.

The additional direct impact on Protasco Bhd if MACC comes in would count IRB probe which shall count approximately RM300mil per every RM1billion tax invasion. On top of MACC confiscating the assets, including Protasco related parties, especially directors and management which happens to be shareholders. Protasco current balance sheet would be at test, compared to TNB, the national grid government linked corporation which is slapped with RM2.07bil tax bill by IRB, according to The Star 12 December 2015 news report. TNB has a much stronger balance sheet to withstand the impact, where Protasco may not be the case.

As of June 2016, Protasco has only RM32.9mil cash in hand, far cry from paying off potential RM300mil tax bill. The NTA per share of RM1.159, by taking in IRB tax bill, may wipe off RM300mil over estimated RM393.95mil Net Asset, or about 76.15% of Protasco NTA. That will leave Protasco with about RM0.276 per share, below PAR VALUE of RM0.50 per share. The fundamental of Protasco would not only does not qualify for bonus issue, it would need to maintain NTA above RM0.25 per share to comply to Bursa Malaysia requirement. If MACC steps in, technically Protasco would be negative NTA, or net owing to the country.

Bursa Malaysia Facilitating Too-Big-To-Fail Graft Money Laundering Factory?

Would Bursa Malaysia be part of the conspiracy? Market is watching if MACC probe is to take place, how the SC and Bursa are to ensure that the shareholders of the potentially largest graft money laundering company, namely Protasco, are not in danger of receiving part of the ill-gotten bribery money in dividend and bonus shares that may have a questionable value.

The people of Malaysia would be happy if MACC would go down the list sooner while counting money in Sabah. Maybe by then, a new record breaking graft money organization would be exposed and captured, mega scale public disastrous would be avoided, billion Ringgit graft money recovered, and the real culprits be put behind bar for facilitating and operating one of the largest ill-gotten graft money laundering operation in (Malaysia) history which is still operating until today.

source: http://www.bursamalaysia.com/market/listed-companies/company-announcements/5215589

NEW ISSUE OF SECURITIES (CHAPTER 6 OF LISTING REQUIREMENTS) : BONUS ISSUES PROTASCO BERHAD ("PROTASCO" OR THE "COMPANY") PROPOSED BONUS ISSUE OF UP TO 84,962,172 NEW ORDINARY SHARES OF RM0.50 EACH IN PROTASCO ("PROTASCO SHARES") ("BONUS SHARES") TO BE CREDITED AS FULLY PAID-UP ON THE BASIS OF ONE BONUS SHARE FOR EVERY FOUR EXISTING PROTASCO SHARES HELD ON THE ENTITLEMENT DATE TO BE DETERMINED LATER ("PROPOSED BONUS ISSUE")

PROTASCO BERHAD ("PROTASCO" OR THE "COMPANY")

PROPOSED BONUS ISSUE OF UP TO 84,962,172 NEW ORDINARY SHARES OF RM0.50 EACH IN PROTASCO ("PROTASCO SHARES") ("BONUS SHARES") TO BE CREDITED AS FULLY PAID-UP ON THE BASIS OF ONE BONUS SHARE FOR EVERY FOUR EXISTING PROTASCO SHARES HELD ON THE ENTITLEMENT DATE TO BE DETERMINED LATER ("PROPOSED BONUS ISSUE")

http://www.freemalaysiatoday.com/category/nation/2016/10/05/rm114m-seizure-in-sabah-graft-case-biggest-in-macc-history/

RM114m seizure in Sabah graft case biggest in MACC history