SC won't hesitate to take action on MQTechon breach of securities laws

KUALA LUMPUR: The Securities Commission (SC) will not hesitate to take any action on MQ Technology Bhd (MQ Tech) if it is found to be in breach of securities laws.

The SC is currently looking into the facts surrounding the Ace Market-listed MQ Tech regarding the possibility of insider trading and will not hesitate to take action if there are any breaches of securities laws, it said in its reply to Bernama yesterday.

The SC was responding to questions on an issue relating to MQ Tech following the contention that two of its substantial shareholders had been acting in concert to sell the company’s warrants and shares ahead of negative news.

On Dec 10, 2016, a newspaper report quoting sources highlighted MQ Tech’s planned entry into Cambodia’s casino market which resulted in the company’s shares jumping.

On Dec 13, MQ Tech announced to Bursa Malaysia that its unit was expanding into Cambodia via a joint-venture with Cambodian Resort and Entertainment Co Ltd (CRE) and subsequently requested a trading halt of its shares from 10.57 am and resumed an hour later at 11.57 am.

On Dec 14, the company called for a press conference to announce that it was in talks with NagaCorp Ltd over plans to build a casino in its new integrated resort and entertainment project in Cambodia.

However, later on the same day, MQ Tech clarified to the stock exchange that the company was not in talks with NagaCorp but instead its wholly-owned subsidiary, Star Acres Sdn Bhd, had on Dec 12, entered into a memorandum of agreement with CRE to develop a theme park in Cambodia.

It was noted that the company’s executive director Teh Eng Huat had resigned on the same day that the press conference was called.

An investment portal described Teh’s resignation as sudden and that he and another substantial shareholder, Goh Boon Soo, had disposed of a huge amount of the company’s warrants and shares they had acquired recently.

The huge disposal of shares by Teh and Goh saw the company’s share price shrink by about 60%, thus infuriating investors as they suspected insider trading.

Meanwhile, MQ Tech announced that it had incurred a higher pre-tax loss of RM1.07mil in the third quarter ended Sept 30, 2016, compared with a pre-tax loss of RM838,000 in the same period a year ago.

Revenue, however, increased to RM4.82mil from RM3.49mil previously. – Bernama