LBS Bina, helmed by group managing director Tan Sri Lim Hock San, is the strategic investor that helped rescue ML Global from the PN17 status.

BY M. HAFIDZ MAHPAR

KUALA LUMPUR: ML Global Bhd is finally free of the Practice Note 17 (PN17) status after six years and amendments to its original regularisation plan that saw property developer LBS Bina Group Bhd becoming a strategic investor.

In a filing with the stock exchange on Thursday, the manufacturer of roof tiles and steel-related building materials said its PN17 classification was uplifted by Bursa Malaysia Securities effective Friday.

ML Global said it had regularised its financial condition and level of operations and no longer triggered any of the criteria under paragraph 2.1 of PN17 of the Main Market Listing Requirements.

Its regularisation plan was completed on Oct 31, 2014, and the company had since been working with its advisers to uplift the PN17 status.

To recap, ML Global (then VTI Vintage Bhd) was admitted into PN17 on March 1, 2010, It was at the time facing numerous suits filed by trade creditors alleging outstanding debts, and it had just announced an unaudited net loss of RM37.43mil for the year ended Dec 31, 2009 due to a 350% surge in operating expenses.

In April 2010, it announced that it was negotiating with a strategic investor to participate in its equity to enhance its tile and construction businesses.

It also proposed a share capital reduction exercise (90 sen of the RM1 par value was cancelled later), fund-raising via a 1-for-1 rights issue and a scheme of arrangement and compromise with creditors.

The company later announced that the private placement of 14.7% of its enlarged paid-up capital would be made to its managing director and substantial shareholder Datuk Beh Hang Kong, Shenzhen Guang Real Estate Group Co Ltd owner Guo Zan Ming and former Shah Alam mayor Datuk Abu Sujak Mahmud.

However, Bursa Securities rejected the proposals in a letter dated April 2, 2012, noting that the regularisation plan must be “sufficiently comprehensive and capable of resolving all problems, financial or otherwise” that had caused the company to trigger the PN17 criteria.

Bursa Securities said ML Global’s proposed regularisation plan relied solely on the group’s existing businesses and that the group had been incurring losses for the past seven audited financial years up to the financial year ended Dec 31, 2010 and continued to incur losses (net of write back of allowance of doubtful debts) for its unaudited financial year ended Dec 31, 2011.

In Feb 2014, ML Global amended its regularisation plan with property developer LBS Bina Group Bhd becoming the strategic investor. LBS would take up Guo’s placement share allocation and subscribe to the rights issue (including Guo’s and Abu Sujak’s entitlements).

According to the new plan, LBS Bina would eventually have a 34.07% direct stake in ML Global after the full exercise of detachable warrants that came with the private placement shares and rights shares.

At an EGM on May 23, 2014, shareholders approved the proposed plan. In July 2014 the company changed its name from VTI Vintage to ML Global.

Datuk Seri Lim Hock San, LBS Bina managing director, became a board member in August 2014.

At present, LBS Bina has a 31.95% stake in ML Global.

ML Global shares closed unchanged on Thursday at 47.5 sen.