Low profile M'sian tycoon emerges as major shareholder of Hibiscus

Petaling Jaya (The Star/ANN) - A.P. Arumugam, the low profile Malaysian tycoon with vast business interests, has emerged as a major shareholder in Hibiscus Petroleum Bhd, a recently listed special purpose acquisition company (SPAC).

Arumugam's son Roushan, aged 39, has been appointed as a director of Hibiscus.

In a media release issued by Hibiscus, the company said Roushan's appointment was "as a corporate representative of a major shareholder of Hibiscus comprising the combined interest of Littleton Holdings Pte Ltd and Sri Inderajaya Holdings Sdn Bhd."

Both companies are vehicles of Arumugam.

Although the total stake acquired remained unclear as of now, The Star's StarBiz understood that Arumugam, via his two vehicles, had taken up Hibiscus share placements at its IPO offer price of 75 sen (25 US cents) per share.

"There was no discount given," said a source.

It also believed that the stake acquired by Arumugam would be made public in a week's time.

Arumugam is chairman and founder of Sri Inderajaya and another vehicle, Makhota Technologies, with a career spanning over 30 years with these companies.

His business interests cover a wide range of sectors from investment holdings in multi-engineering and real estate to electrical power generation, mechanical, electronics and utilities infrastructure entities.

Alternatively, Arumugam also has diversified business interests in publishing, travel, agriculture, food and education and sits on advisory committees in a number of international groups and organisations.

Hibiscus shares, which made a weak debut on the Main Market of Bursa Malaysia on Monday, closing at 53 sen below its IPO price of 75 sen, showed some recovery Tuesday.

RHB Research Institute said the market could have mispriced the shares of Hibiscus Petroleum when it was listed.

"In our view, given that the share has the 90% refund guarantee, it should trade at a minimum of 67.5 sen. If we include the after-tax interest over a three-year period, the share should trade at 73 sen. We thus estimate a minimum arbitrage gain of 14 sen a share or an upside of 26.2%," it said.

Hibiscus is leveraging on industry heavyweights, such as Petronas Carigali Sdn Bhd board member and former Shell Malaysia deputy chairman Zainul Rahim Mohd Zain as its chairman, and Perisai's Zainol Izzet as director.

It also has two foreign experts on board, namely India-based Reliance Industries Ltd's Dr Rabi Bastia Padmashree as its non-executive director and former Sarawak Shell Bhd project manager Dr Pascal Hos as its head of petroleum engineering.

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