Old prophet said that money can’t buy everything and I couldn’t agree more. One thing that money cant buy is our integrity. Our integrity depends on how we act or treat other people, so we should treat people well by being respect and honest or veracity. Veracity is one important thing that formed our integrity. Once you dishonest your integrity will be deformed. Honesty is important especially if you do businnes with others. There are alot of story how dishonesty can destroy someone carrier over a night. One of them is Sri Chong Ket Pen’s case.
(Chong Ket Pen)
The case started when Chong Ket Pen made the deal with Global Capital Ltd, an oil and gass company which based in Indonesia on 3rd november 2012. In that Deal, Chong Ket Pen assuures that he will propose to the Board of Protasco Bhd, A Malasyan company to undertake a new oil and gas business subsidiary called PT Anglo Slavic Utama (PT ASU). Following that, Global Capital Ltd acquired a 27.11% stake in Protasco – a deal concluded within one month of discussions and negotiations, for USD 24 million or a 33% premium over the market price.
Soon after, Protasco Bhd announced that it was set to buy 76% of equity interest of an Indonesian oil and gas company, PT ASU with a value of USD 55 million (Rp. 800 billion). The deal, however, did not materialize due to non-fulfillment of conditions. Chong Ket Pen should complete the deal in 6 months, unfortenetly the deal didn’t go smooth. Chong Ket Pen delayed the deal from six months to 18 months, inducing PT ASU to accept a revised deal of merely a USD 22 million deal or 63% equity. Chong Ket Pen’s son, Kenny Chong Ther Nen – who was entrusted by his father to execute the logistics of the deal, colluded with PT ASU Former Director Tjoe Yudhis Gathrie to forge false documents, to make it look as if PT ASU has failed to comply to the terms of the SPA.
The Indonesia-based company is claiming USD 88 million from Chong Ket Pen over his act of contract breach, including loss of investment and future profits for the stake in Protasco Bhd; loss of margin to finance the acquisition of shares up to USD 18 million; liability of USD 55 million to PT ASU – as guarantor for Chong Ket Pen pursuant to the Investment Guarantee Agreement; and USD 15.5 million as payment for the profit guarantee under the Investment Guarantee Agreement. Subsequently, it was discovered that Chong Ket Pen had made the proposal for the transaction of Protasco Bhd’s shares without disclosing to the Board that he has personal interest in obtaining control over the company, through the Investment Guarantee Agreement.
Following this discovery, Chong Ket Pen maneuvered by putting the blame on Global Capital Ltd’sinvestors, Tey Por Yee and Ooi Kok Aun, putting them under the limelight in 2014 on allegations of criminal breach of trust due to the non-disclosure of interest in a transaction involving USD 20.3 million. They, however, were granted a discharge not amounting to an acquittal by the sessions court in September 2017, which also proved what was brought by Chong Ket Pen as sham documents. Bursa Malaysia public information also revealed that Chong Ket Pen has been drawing unrealistic remunerations from Protasco Bhd at the peak of USD 576,000 in 2017 and USD 1 million in 2016 respectively, after he gained control over the company. This suggested that Chong Ket Penmentered into business transactions and decisions on operation, remuneration, payments of dividends and salaries for his own benefit at the expense and the best interests of the company.
Global Capital Ltd came into the thought that Chong Ket Pen has failed to ensure that Protasco Bhd was profitable, with a profit before tax of USD 7.1 million and USD 8.3 million in the third and fourth year under the Investment Guarantee Agreement. Aside from that, a total of USD 26.2 million profit was also guaranteed over the four years. Furthermore, it was also reported that Protasco Bhd had recently lost a huge contract, as its subsidiary HCM Engineering Sdn Bhd received a letter of termination from Turnpike Synergy Sdn Bhd (TSSB) due to delays in the project, suggesting a USD 622,000 earnings impact. Following this, CIMB IB Research has therefore maintained its “Reduce” rating on Protasco Bhd at MYR 20 cents with a lower target price of MYR17 cents (from MYR 30 cents). Weak job execution and poor contract visibility is likely to weigh on its shares price.situasion
. As you see, Chong Ket Pen did so many dishonest things to gain something that not belong to him. If you built something with dishonesty, it will ruin you. We should learn from this case that everything that start with wrong motive only will lead us to the worst situasion.