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Categories
| Quek family sells 3.6% stake in Multi Sports |
| Business & Market 2009 | |||
| Written by Yong Yen Nie | |||
| Wednesday, 02 September 2009 11:21 | |||
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According to filings to Bursa Malaysia last Friday, the Quek family, via its Cayman Islands incorporated vehicle GuoLine Group Management Co Ltd, had disposed of a 3.6% stake comprising 12.97 million shares in Multi Sports on Aug 24. The Quek family had held about 15% of the company before selling down the shares. It now owns about 11.4% stake or 41.03 million shares in Multi Sports. It is not known why the family decided to sell down its stake in the company. Yesterday, Multi Sports fell to a historical low of 55 sen since its debut of 85 sen on Aug 19. At its debut, Multi Sports closed 10% down to 76.5 sen from its offer price of 85 sen. Multi Sports, which operates in Jinjiang city in Fujian province, was the second direct listing of a Chinese company on Bursa Malaysia Securities on Aug 19, following the first by Xingquan International Sports Holdings Ltd on July 10 this year. According to its prospectus, Multi Sports is one of the five largest shoe sole-makers in Jinjiang currently, with a 1,929-strong workforce, of whom 64% or 1,241 are skilled workers. The group has 300 customers, including Guohui, 361 degrees and Xdlong, owners of well-known local sports shoe brands. Between 2005 and 2008, its annual production grew from about 4.9 million to 22.1 million pairs of shoe soles, with some 300 designs across four main product lines. Both Multi Sports and Xingquan have seen their shares spiralling on a downtrend since being listed. Since listing, Xingquan’s share price has fallen 22.8% to close at RM1.38 yesterday from its offer price of RM1.78. Multi Sports has fallen 35.3% to 55 sen yesterday. Currently, Xingquan and Multi Sports are trading at a price earnings ratio (PER) of four times, which is about half the PER of shoemakers listed on the Singapore and Hong Kong stock exchanges. Industry observers said Chinese companies’ listings had not been as well received by investors here as initially thought they might be. One of the reasons was because investors here lacked understanding of the Chinese market, an industry observer said. Additionally, investors were more cautious of Chinese companies, following reports of fraud in some of the Chinese companies listed in Singapore, known as ‘S-chips’. Also the troubles besetting the Chinese stock markets now may have an indirect impact on the two stocks here. This article appeared in The Edge Financial Daily, September 2, 2009.
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