SERBA Dinamik Holdings Bhd will doubtlessly have a lot of convincing – and pacifying – to do at its fifth annual general meeting (AGM) which will be staged virtually on Jan 31 (Monday) at 3pm.

Aghast with the latest corporate development surrounding the integrated global oil & gas (O&G) service provider, one can imagine the event to be an emotionally-charged affair with shareholders fielding a myriad of questions that range from battered share price to how the group intends to wrangle its way of its series of court cases to what does the future hold for the company.

Yesterday (Jan 6), the company found itself slipping into the Practice Note 17 (PN17) status after its external auditor, Nexia SSY PLT, expressed an opinion disclaimer in the company’s audited financial statements for the 18-month financial period ended June 30, 2021.

On top of that, Serba Dinamik also reported a 124% deviation by having stated RM758.38 mil as its unaudited net profit for the 18-month financial period ended June 30, 2021 as opposed to a net loss of RM185.37 mil in its audited financial statement for the said period.

Embedded in the company’s circular to shareholders yesterday, there are three resolutions which require shareholders’ approval at its AGM – of which the proposed renewal of shareholders’ mandate for recurrent related party transactions (RRPT) of a revenue or trading nature – may not secure favourable response from shareholders.

The other two matters are (i) proposed renewal of shareholders’ mandate for share buyback authority; and (ii) proposed alteration of the constitution by replacing with a new constitution.

According to Serba Dinamik, obtaining the proposed RRPT mandate would no longer necessitate it to announce/convene separate general meetings to seek shareholders’ approval as and when such RRPTs occur.

“This would substantially reduce the time, administrative requirements, inconvenience and expense associated with the convening of general meetings on an ad hoc basis without compromising the corporate objectives of the group or adversely affecting the business opportunities available therein,”  justified the company.

The seeking of the mandate could be linked to the brouhaha emanating from Serba Dinamik’s involvement in a RM7.7 bil project with little-known Block 7 Investment LLC which it has vehemently denied as having any RPT nature.

Recall that questions have been raised about the mega contract which was secured by Serba Dinamik’s wholly-owned subsidiary Serba Dinamik Investment Ltd (SDIL) in April 2020.

This is because SDIL also owns a stake in Block 7 through a company called EFIRE Capital Holdings Ltd where Serba Dinamik group managing director/CEO and largest shareholder Datuk Dr Mohd Abdul Karim Abdullah also serves as a vice chairman.

Serba Dinamik was last transacted at 35 sen at the close of the mid-day trading on Oct 22 prior to the trading suspension of its shares/warrants, hence giving the company a market capitalisation of RM1.3 bil. – Jan 7, 2022