[SINGAPORE] Components manufacturer Fu Yu is pursuing claims against six individuals, including its largest shareholder Victor Lim, in relation to investigations into its subsidiary Fu Yu Supply Chain Solutions (FYSCS).
FYSCS was placed under investigation after an internal audit revealed that the unit made one or more unverifiable arrangements regarding a payment worth around US$3 million to a third party, for which services did not appear to have been rendered.
Victor Lim, one of the six individuals, previously made several unsuccessful bids to oust Fu Yu directors, as well as appoint new names to the company’s board, citing the company’s “poor performance” as the reason behind his actions.
On Tuesday (Apr 1), Fu Yu said that the claims are for its acquisition of FYSCS, the purported misuse of FYSCS’ resources, and the payment of a pre-paid commission of around US$3 million.
The company has sent letters of demand against the persons it is seeking claims from, through its legal advisor Nine Yards Chambers LLC, to commence the process of pursuing the claims.
The six individuals are: Lim, Frank Zhang, Hazel Cai, Yasmin Lim, Wong Ka Wing and Tan Xin Yi.
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It is making claims against Victor Lim and Zhang over the acquisition of FYSCS – formerly known as Avantgarde Enterprise – as it alleges that there has been a “breach of duties, misrepresentation, and a conspiracy to cause loss” to the company.
It is also seeking claims against Victor Lim, Cai and Yasmin Lim in relation to the misuse of FYSCS resources, as well as pursuing claims against Victor Lim, Cai, Wong, and Tan over the pre-paid commission, as it alleges that there was a breach of duties and a “conspiracy to cause loss to FYSCS”.
In response to the Fu Yu’s announcement, Victor Lim said that he was “disappointed but not surprised” at what he called the company’s “latest attempt to deflect attention from the real issues that need to be addressed, such as reduced revenues in our core manufacturing business”.
“I firmly deny any and all allegations of wrongdoing that the current board has seen fit to publicise even as the investigations are ongoing. I am confident of my position and am prepared to defend myself in court if the current board should cause the company to take legal action against me,” he said.
The company said it would update its shareholders if there are further developments, as and when necessary. It added that it would remain focused on carrying on with business as usual.
It urged shareholders to exercise caution when dealing with its shares.
The counter closed on Tuesday flat at S$0.096 before the announcement.
