A shareholder with several million MC Payment shares is upset that a proxy form which was signed by the shareholder was used to oust directors from the board at an AGM held on April 28. “I did not indicate any votes for or against the resolutions in the proxy form as I thought the AGM was just to adopt the company accounts. I did not know I had to indicate my votes on the form,” the shareholder griped.
This is not unusual as shareholders have often been asked for proxies, for proxy form holders to observe AGMs, and many have not indicated how they would want the proxy holders to vote. Almost never would proxy holders vote against shareholders’ wishes.
The MC Payment shareholder said, “when I retrieved the form from Tricor, I discovered that the proxy form included votes in favour of resolutions 1,3, 5 to 9, but votes against resolutions 2 and 4.”
Resolution 2 was to re-elect Harry Ng as a director, and resolution 4 was to re-elect Shawn Ching as a director. Both Ng and Shawn Ching failed to garner sufficient votes with 56.69% of votes voting against these two resolutions. The chairman of the AGM was MC Payment's chairman Albert Cheok.
According to a report by Mak Yuen Teen, associate professor of Accounting at NUS Business School, on his website Governance for stakeholders, Shawn Ching offered himself up for re-election because MC Payment’s CEO Anthony Koh said he was not confident of garnering sufficient votes to get re-elected. Koh subsequently voted against re-electing Shawn Ching to the board.
“Mr Shawn losing his directorship at the AGM was a surprise because he had been appointed at the EGM just three months earlier with 100% of the votes. Further, he is the son of Ching Chiat Kwong, MCP’s controlling shareholder, who owns 27.06% of the shares. The only other substantial shareholder of MCP, Koh Beng Kiok Anthony, owns just 5.88%,” Mak observed.
In a statement on the SGX on June 19, MC Payment did not directly address the standing-in of Shawn Ching for Koh and the matter of the proxy votes. However, the company said it would do so on or before June 23, 2021. "The Board notes that, despite repeated requests from the Company, Mr Ching has to-date not provided any details or evidence of these allegations or the alleged wrongdoer. Be that as it may, the independent directors of the Company, for good measure, have taken steps to look into this and will update the Company’s shareholders in due course. The Company will address Mr Ching’s allegations in greater detail in the Company’s second circular to its shareholders, which will be published on SGXNet and on the Company’s corporate website at on or before June 23, 2021," the company said.
In the early hours of June 22, MC Payment announced an EGM, requisitioned by Ching, would be held on July 30, 2021, to vote to remove five directors. These are current chairman Cheok, current CEO Koh, Kim Moon Soo, Lilian Koh and Ong Kim Huat, who was nominated as a director in May.
One of the points of contention between Ching on the one side, and Koh and Cheok on the other was a termsheet signed with representatives of NGSC, a company on the SGX’s watchlist, and which SGX had instructed to delist. Among the terms, MC Payment would acquire 51% of NGSC for the equivalent of $4.9 million based on a 100% value of $9.6 million, paid for with MC Payment shares.
On June 11, in reply to SGX queries, the company said:” “The Board’s grant of authorisation to Mr Anthony Koh was to allow the Company to engage in exploratory talks with NGSC Limited. These talks have concluded with no outcome. (b) As at the date of this announcement, the Company did not enter, and has not entered, into any binding term sheets or agreements in relation to any acquisition of NGSC Limited. Accordingly, no announcements were made by the Company on this.”
Interestingly, the term sheet with NGSC seen by The Edge says “In consideration of the time and expenses devoted and to be devoted by the Purchaser (as defined below) with respect to the Proposed Acquisition, Provisions 9, 10, I I and 13 of this Term Sheet shall be binding obligations of the Vendors and of the Company upon their acceptance of the Term Sheet, whether or not the Definitive Agreement or Proposed Acquisition is consummated.”
Mak has further revealed that Ong and an NGSC director were both directors at the same time at HON Corp, (listed on HKEX's GEM), before resigning.
On June 17, MC Payment announced a letter of intent which was signed with OY! “[MC Payment] on June 16, received a Letter of Intent dated 14 June 2021 (LOI) from PT Dompet Harapan Bangsa (OY!), a payments and remittance company based in Indonesia, for OY! to explore investment opportunities by taking a strategic equity stake in the Company. Pursuant to the LOI, OY! indicated that it intends to move towards a formal term sheet or a memorandum of agreement “soonest”,” the company said.
Mak pointed out that the term sheet with NGSC was not announced until queried by the SGX, yet an LOI with OY! was announced. The Edge has approached the company for comment. Since the LOI with OY! was announced, MC Payment’s share price is up some 63%.
More immediately, MC Payment will be holding an EGM on June 30 this year, requisitioned by Ching, to appoint as directors Harry Ng, Shawn Ching, Johnny Chee, Henry Tan and Ching himself to the board.