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Maika: Maika Share Buyout Proposal For Real, Says Vel Paari

Contributed by Anonymous on Monday, April 19 @ 08:51:49 CDT

By S. Retna & Alan Ting

HULU SELANGOR, April 19 (Bernama) -- The deal to sell Maika Holdings Bhd to a local Indian-owned consortium is for real and details are now being worked out, its chief executive officer, S. Vel Paari, said.

He denied that it was an election gimmick to attract Indian voters in Hulu Selangor.

Shareholders of Maika should "hold their horses just a little while longer as details of the deal will be announced as soon as possible after a number of issues have been ironed out," he told Bernama here.

On April 16, Bernama ran a story that the long wait by some 66,000 shareholders of Maika was about to end as a local Indian private sector group had agreed to purchase all of their investments for about RM106 million.

The proposed purchase value of the shares is RM20 million above the total net value of Maika's assets, which are only worth about RM85 million currently.

Maika shareholders are mainly poor Indian estate workers who had invested in Maika shares in 1984 by pawning their jewellery while some had withdrawn their life savings.

Maika was established in 1982 to enable Malaysian Indians to participate in the country's economic growth. However, the company was unable to produce the required results, much to the disillusionment of its shareholders.

The relatively poor return on investment of Maika shares had been a nagging problem for the MIC and the Malaysian Indian community for the past 26 years.

The matter had been brought to the attention of the government on numerous occasions and it was only recently that a decision was made to resolve it.

MIC president Datuk Seri S. Samy Vellu, confirming the Bernama report last Saturday, said:"It has been a long and difficult journey but now the issue looks set to be resolved. I think the shareholders will be happy and we are relieved too. I have been briefed about the buyout."

Meanwhile, B. Krishnan, a Maika shareholder, when contacted by Bernama, said that while settling the problem was good, Maika should ensure that the deal was beneficial to shareholders.

"Now we at least see the light at the end of the tunnel after 28 years. It is positive and I hope the shareholders will agree to the deal and put an end to this nagging problem," he said.

He said Maika shareholders should not only be paid "ringgit for ringgit" for their investments but also be given "something extra" for their long wait.

M. Dharmakoundar, another shareholder, also agreed that dividends should be paid as well because Maika had not paid any in the past.

"If there is any buyout, then shareholders must be compensated adequately," he said.

S. Nadarajah, a Maika shareholder who has been campaigning for dividend payment for many years, said the proposal by the unnamed investor group put the share buyout at 80 sen per share against the entire shareholding of 125 million shares.

He claimed that the proposed purchase sum of RM106 million was also lower than the RM149 million offered by Usaha Tegas Sdn Bhd for Oriental Capital Assurance Bhd, a 74.165 per cent subsidiary of Maika, in 2008. Usaha Tegas is an investment company controlled by tycoon T. Ananda Krishnan.

He claimed that the latest share offer was inferior as the would-be investor would get to control the insurance company via the purchase of Maika for a lower price.

Nadarajah, who also asked whether the recent announcement was an election ploy as there were 1,500 Maika shareholders in Hulu Selangor, said Maika should provide details to clear the air on the proposal.




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