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Tuesday, February 13, 2007

Maika Fiasco


Maika in the dark over Samy's scheme

K Kabilan

Maika Holdings, the investment arm of MIC, has no new plans in the pipeline to buy back shares from its investors despite a personal assurance from party president S Samy Vellu three months ago.

A Maika official told malaysiakini that the assurance by Samy Vellu to give RM130 for every RM100 invested was not a plan mooted by the investment arm.

“We have not heard of that plan until Samy Vellu was quoted in the Tamil papers as giving that assurance,” added the official who wanted to remain anonymous.

Last November, Samy Vellu assured Maika shareholders that he will personally ensure that they get their money back in three months.

That deadline is just two days away and many investors are still in the dark as to their situation.
However, the Maika official said the investment arm had not received any proposals from Samy Vellu on the buy-back scheme.

In fact, the official added, Maika Holdings was going to propose its own scheme in the next Annual General Meeting which will be held in June.

“At the meeting, we will explain our situation and then propose a new scheme to buy back shares from our investors,” said the official.

Maika chief executive officer S Vell Paari, who is also Samy Vellu’s son, was not available for comment.

Samy Vellu, who is also the works minister, is presently on an official trip to Ghana and could not be reached for comment.

When malaysiakini visited the Maika headquarters last week, it was learnt that many investors had submitted their share certificates in response to Samy Vellu’s assurance.

For these investors, Maika is in the process of telling them that they would not be getting RM130 for every RM100.

“What we can work out for them is to buy back their shares at the price they bought it for - RM1 for RM1,” said an official who has been dealing with these investors.

Pensioner A Mutthiah, 60, from Rawang said then that he would only believe when he sees the money.

Similarly another shareholder M Alagamai, a rubber tapper, who is in her 60s, is also pessimistic about the prospect of seeing her money again.

Contacted today, both these shareholders were not surprised with the latest development.

“Anyway, he has two more days to go before his deadline ends. He still has time. Let’s see if he comes out with our money,” said Mutthiah.

Maika Holdings was established in 1982 purportedly to enable Indian Malaysians to share in the country’s economic growth.

The company raised RM106 million in 1984 from 66,000 investors - many by pawning their jewellery and selling their properties to invest - but some shareholders had since accused the company of squandering the capital through dubious channels after seeing little returns to their investments.

Many of Maika Holdings business ventures had failed to take off. It has only paid its shareholders cash dividends on seven occasions to date, the last being in 1995.

“Samy Vellu should not be silent on this matter. He should stick to his promise to return the money to the investors,” the daily quoted the Penang businessman as saying.