Hong Kong-based private equity house Primus Pacific Partners is suing nine directors of Eon Capital, a Malaysian bank in which Primus owns 20 per cent, in an attempt to block a takeover of the lender that will cause it to lose money on its investment.
In a trial that begins in Kuala Lumpur today, Primus plans to say Eon's management board had agreed to sell the company at a price Primus argues undervalues the business, according to documents filed with the court.
In its legal petition, Primus accuses the first and second defendants in the suit, Eon Capital majority shareholder Rin Kei Mei, a Malaysian businessman in his 70s, and Tiong Ik King, the brother of Sarawak timber billionaire Tiong Hiew King, of encouraging what it alleges is a low offer for Eon Capital because they wanted to sell out.
All of Eon's directors declined to comment on the case.
Rin and the Tiong family hold 33 per cent of the bank's shares between them, according to a circular Eon Capital released on September 1.
Eon's board agreed to sell the bank for M$7.30 a share to another Malaysian lender, Hong Leong Bank, in early April. The deal, which has not yet been voted on by shareholders, valued Eon, the country's seventh-largest lender, at M$5.1 billion (HK$12.69 billion). Hong Leong, which declined to comment, is not a defendant in the lawsuit.