Sharanya Pillai (Apr 20): The current board of Datapulse Technology successfully dodged an attempt to be ousted on Friday, clearing the way for the company’s controversial diversification plans into the haircare business.

At a raucous extraordinary general meeting of nearly 200 shareholders, shareholders voted against resolutions to oust CEO and executive director Wilson Teng, chairman Low Beng Tin, and independent directors Rainer Teo and Thomas Ng.

They also voted against resolutions to appoint the slate of directors proposed by the dissenting faction, namely Ng Bie Tjin @ Djuniarti Intan as non-independent director and Koh Wee Seng, Ng Boon Yew and Loo Cheng Guan as independent directors.

Out of some 138 million votes cast, about the same proportion of votes -- 59% -- were cast against each of the eight resolutions.

In addition, 58.9% of votes were cast in favour of the current board’s controversial diversification plans into consumer care and investments. The current board plans to move into the hair care business via Wayco Manufacturing, a Malaysian manufacturer of hair care products, which it acquired from Way Company for $3.43 million on Dec 12.

Shareholders further approved a special dividend of 1 cent per share, with 99.5% of votes in favour of the move. Datapulse’s sale of its Tai Seng facility, completed on Jan 31, had generated a $44.6 million gain on disposal.

Caption: Minority shareholder Chew Ah Kong urges shareholders to vote against the proposed 1-cent per share dividend  

Datapulse’s controlling shareholder, Ng Siew Hong, owns a 29% stake. Intan and her family vehicle Uniseraya own 16% of the company.

Commenting on the board’s victory, CEO Wilson Teng says that the board will “focus on what the shareholders have approved so far on the business diversification”.

When asked about the concerns raised on the Wayco deal, Teng adds: “We hear the shareholders… We will review at the board level and see what we can continue to do. More important for me is to go further on the business diversification and on the consumer part of it as well.”

Ang Kong Meng, the owner of Way Company, was present at the EGM. He tells The Edge Singapore that the dissenting shareholders should have sold their shares earlier, rather than hoping for the company to be liquidated.

“If I’m a shareholder and I don’t agree with the board, I should have sold it at [a share price of] 37 cents. It’s better than finally getting about 35 cents [per share] if I liquidate the company… If they wanted their money back they should have sold it. These [people] are brainless. They don’t know accounting,” he says.  

Wayco Manufacturing now also faces better prospects, he says. “I think there is a future for the company now. Because I only spend two hours a week running this company,” he says. “I’m basically an investor and make sure the people do [their jobs]. But if it is not run by the owner himself, the business...can never take off,” he says.

Despite her defeat, Intan says that she was pleased with the support of minority shareholders. However, she also wishes more could have shown up to vote. “I feel like this is the US elections, we won by the popular vote. I think we have more shares than [those in support of the current board], represented by the minority shareholders. It’s just that there were fragmented shareholdings in terms of the structure of shareholders of Datapulse. Not enough minority shareholders have shown up.”

The three-hour EGM saw minority shareholders demanding greater transparency in the Wayco deal, with several questioning the motives of Siew Hong and the incumbent board. Corporate governance Mak Yuen Teen also raised several questions on the company’s internal policies.

However, once it was clear that the board had succeeded, the exuberance faded out. Before the voting on the final resolution, minority shareholder Chew Ah Kong interrupted Low to make a last-ditch attempt to block the move.

Calling the 1 cent dividend “peanuts”, he told the crowd to demand a higher payout from the board: “A lot of us are old people, we want our money to be paid back to us.”