Oei Hong Leong sues firm over planned stake purchase

A file photo of Mr Oei Hong Leong and his wife, Mrs Angela Oei, at the tycoon's 60th birthday celebration. PHOTO: ANGELA OEI
A file photo of Mr Oei Hong Leong and his wife, Mrs Angela Oei, at the tycoon's 60th birthday celebration. PHOTO: ANGELA OEI

Tycoon Oei Hong Leong is suing Raffles Education Corp over its plan to raise its stake in a Chinese property firm.

Mr Oei, who owns 13.05 per cent of Raffles Education, and his firm Oei Hong Leong Art Museum have commenced an originating summons in the Singapore High Court, the education provider said in a filing on Wednesday night.

The suit seeks to allow Mr Oei and his firm to inspect certain documents set out in a Raffles Education circular dated Sept 8.

The circular was for the proposed acquisition of a 35.9 per cent interest in a joint venture company, Langfang Hezhong Real Estate Development, for about 254 million yuan (S$49.2 million) in cash.

A Raffles Education subsidiary held a 34.1 per cent interest in the Chinese property firm as at July 16, while Langfang Heying Real Estate Development owned the rest.

The circular referred to several documents - including the framework and shareholders' agreements - that were not made available for inspection before Wednesday's extraordinary general meeting (EGM).

Raffles Education responded to shareholders' questions on Tuesday about these documents.

It noted that a summary of the relevant terms was already disclosed in the circular and that their material terms were disclosed in its previous announcements.

Mr Oei's summons also demanded answers to certain queries before voting on the resolution for the proposed acquisition at any Raffles Education meeting.

The plaintiffs are seeking an injunction against the company to stop it holding any shareholders' meeting at which the proposed resolution will be voted on.

It also wants an injunction to stop Raffles Education from proceeding with any further acts in relation to the stake purchase.

Mr Oei had applied for interim injunctions in the High Court but these were dismissed on Wednesday, allowing Raffles Education to conduct its EGM later that day.

Its shareholders then approved the proposed acquisition, with 78.6 per cent voting in favour and 21.4 per cent against.

Raffles Education said on Wednesday night that it will defend Mr Oei's originating summons "vigorously". It added that it was advised that the summons is without merit.

Mr Oei's latest litigation comes after he sued Raffles Education founder Chew Hua Seng for allegedly reneging on his promise to get a buyer for Mr Oei's shares at 44 cents apiece, based on a handwritten "confidential agreement" dated Oct 16, 2017 signed by the two men.

The High Court dismissed that lawsuit against Mr Chew in February. In August, the Court of Appeal dismissed Mr Oei's appeal against the judgment.

Raffles Education shares closed down 3.85 per cent at 12.5 cents yesterday.

THE BUSINESS TIMES

Join ST's Telegram channel and get the latest breaking news delivered to you.

A version of this article appeared in the print edition of The Straits Times on October 02, 2020, with the headline Oei Hong Leong sues firm over planned stake purchase. Subscribe