Curious coincidences behind Epicentre's missing CEO

WHEN it comes to strange coincidences, it may be hard to upstage Catalist-listed Epicentre Holdings - the company once well known as a re-seller of Apple products, but has, since May, become better remembered for its vanished chief executive officer.

In July, Epicentre sacked this CEO (also its executive chairman), Lim Tiong Hian, also known as Kenneth Lim, for being a no-show. The company said he had been "entirely uncontactable", and had not offered any explanation for his absence since May 24.

His disappearance came about a month after he had raised his stake in the company from 17.97 per cent to 18.9 per cent, giving him the mandate to set the group's strategic direction and track its financials and profitability - big words and mere promises, as it turns out.

Not ship-shape

Epicentre was far from shipshape when this scandal blew. (Its stock has been suspended since the end of May.)

Last year, it exited the Apple Premium Resellers business in Singapore, after Apple's own retail arm entered the city state. Except for a 2017 move into hair removal and skin rejuvenation services - yes, you read that right - its hunt for a new business has turned up empty.

A planned S$400 million reverse takeover (RTO) of a "major regional property development business that comes with a mixed-use development in the heart of Bangkok" and hotel management company was canned last December.

Epicentre's bid to shore up funds to prowl for new assets also failed; a rights issue was scrapped in place of a S$9 million placement exercise, which also suffered the same fate.

As doubts arose over the company's ability to continue as a growing concern and creditors came knocking, the court last week ordered interim judicial managers to be appointed for Epicentre following an application filed by a creditor.

The company has hired Ernst & Young Advisory as its special auditor to review past transactions and probe matters related to its missing chairman and acting CEO.

In mid-June, amid concerns over the state of affairs at the company, chiefly its missing former chief, the Singapore Exchange Regulation (SGX Regco) told Epicentre that it needed the regulator's nod to appoint a director or executive director.

As investors were still unpacking the odd goings-on, the company announced the appointment of Drew Ethan Madacsi as independent director on July 23.

Epicentre said the SGX Regco had no objection to the appointment of Mr Madacsi, non-executive chairman of mainboard-listed MMP Resources, which until 2015 was known as Sino Construction.

But the appointment piques some interest: In mid-2014, Sino Construction had taken Mr Lim on board - he was said to have been head-hunted - as executive director.

Less than two weeks after Mr Madacsi's appointment to the company in February 2015, Mr Lim resigned from the company, citing "other personal commitments".

By then, Sino Construction was already mired in a slew of board and management changes, and its stock price was making wild movements.

There are other more bizarre coincidences.

Days after Mr Lim's disappearance was revealed, Haitong International Financial Products emerged as a substantial shareholder of Epicentre, with a 25.41 per cent interest. Based on SGX's filings, this followed an "enforcement" by Haitong over Epicentre shares that were charged to it as security for a transaction.

This wasn't all, as it turned out.

The same day, SGX filings revealed that Haitong also surfaced at another Catalist-listed firm AA Group as a substantial shareholder, with a 19.18 per cent stake. AA Group shares a common sponsor with Epicentre - Stamford Corporate Services.

AA Group's former substantial shareholder was a mystery until late last month, when AA Group said it has identified the individual and referred the matter to the Monetary Authority of Singapore.

That wasn't the only link between the two firms. AA Group also disclosed last month that it received two statutory demands and a letter of demand from an alleged creditor, over financing agreements allegedly signed on its behalf by Mr Lim.

AA Group said Mr Lim "is not and has never been a director, officer or employee of the company or any of its subsidiaries", but added that he was an "acquaintance" of some directors and officers at AA Group.

SGX asks for details

That must have been far too vague for SGX, which pushed AA Group for more details.

The prompting was fruitful. AA Group revealed that Mr Lim was acquainted with the company's chairman, two executive directors (one of whom is also Epicentre's independent director), an independent director (who is also a shareholder of the company that owned the Thai property firm that was to be acquired by Epicentre through an RTO that flopped last year), and its company secretary. AA Group said it was conducting a conflict-of-interest report on their ties.

For sure, these developments should be more than enough to make one squirm.

But the controversy hints at being more pervasive, involving more than one listed entity.

Particularly in this era following the penny stock crash and huge governance fallouts in entities such as Yuuzoo Networks Group Corp and Midas Holdings, these developments ought to make market watchers sit up and wonder: What else is left to unearth?