From the ST archives: Key changes at Citiraya as CEO gets the boot

This article was first published in The Straits print edition on April 5, 2005.

Shareholders of Citiraya Industries have something to cheer about at last, with the axe finally falling on the company’s missing boss and the white knights coming on board.

But questions remain as to how long the shares will stay on hold as the company’s viability remains in doubt.

Some of the uncertainties were removed yesterday when Citiraya announced that it had booted out co-founder Ng Teck Lee. Mr Ng has been out of contact for several weeks and is believed to have left Singapore.

He has been replaced as chief executive officer (CEO) by a former Hewlett-Packard (HP) executive, Mr Hengky Oeni.

In a further announcement yesterday, another former HP man, Mr Lee Kim Bock, 58, has come on board in the newly created position of president. His duties cover company operations and the development and expansion of group business.

And two officers linked with the previous management - chief operating officer Richard Basil Jacob and chief financial officer Gan Chin Chin - have resigned as directors.

Mr Jacob will stay on as an executive but Ms Gan, who is helping with the police investigations, is on unrecorded leave.

And the white knights who last month proposed plans to inject up to $100 million into Citiraya - former HP managing director Koh Boon Hwee, 54, and fund manager Low Check Kian, 45 - have joined the board as non-executive directors.

Citiraya’s chairman and independent director, Dr Michael Lim, told The Straits Times yesterday that Mr Oeni and Mr Lee will be working full time to help the company to retain its customers - and its credibility in the market.

Mr Oeni, 50, had a 16-year career with HP before striking out in 1996 to set up his own company.

Mr Lee, who has more than 30 years of experience in contract manufacturing, was the CEO of Omni Industries until it was acquired by United States-based Celestica in 2001.

“The company is still there. It is largely intact. What we have to do now is to rev up the engines and get it started again,” said Dr Lim.

With the entry of the white knights, Dr Lim is hoping that business will pick up. “There is business currently, but the ... volume is not the same as what it had been before.”

The focus of the new management team is to talk to the company’s customers, suppliers and bankers and get it back on its feet, he added.

Citiraya, which has been suspended from trading since late January, is under investigation by the Commercial Affairs Department and the Corrupt Practices Investigation Bureau.

Customers have suspended dealings and banks have frozen the company’s credit lines while they await the outcome of the probes.

Dr Lim said there was no indication how long the investigations would take. He also said that Mr Ng, the former CEO, is still uncontactable.

And even though Mr Koh’s investment consortium is tightening its grip with the appointment of full-time executives to run Citiraya, Dr Lim was still hopeful that there will be counter-bids, as “people are still talking to us”.

Mr Koh’s investment consortium plans to take a 70 per cent stake in the enlarged capital of Citiraya, subject to a three-month due diligence on the company.

Some investors are unhappy over the proposal as the new shares could be offered to the consortium at between 12 and 25 cents each, depending on valuation calculations. Citiraya last traded at $1.08 when it was suspended.

But Dr Lim had earlier argued that Citiraya’s shareholders would be the ones to ultimately decide the outcome at an extraordinary general meeting to approve any rescue plan.

Who’s in and who’s out

IN

- White knights Koh Boon Hwee and Low Check Kian, who last month proposed plans to inject up to $100 million into Citiraya, will join the company’s board as non-executive directors.

- Mr Lee Kim Bock fills the new post of president. His duties cover operations and business growth.

OUT

- Mr Ng Teck Lee has been out of contact for several weeks and is believed to have left Singapore.

- Two officers linked to the previous management - chief financial officer Gan Chin Chin and chief operating officer Richard Basil Jacob - have resigned as directors. Mr Jacob will stay on as an executive but Ms Gan, who is helping with investigations, is on unrecorded leave.