Published July 15, 2009

Transcu Group stock climbs 2.2%

A High Court ruling enforcing judgment for 830m yen claim against its CEO had no impact

By JOYCE HOOI

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TRANSCU Group's stock inched upwards by 2.2 per cent yesterday, despite news of the recent High Court ruling enforcing a judgment for an 830 million yen (S$13.01 million) claim against Transcu Group's chief executive Akihiko Matsumura.

Mr Matsumura: His shares worth 527.3m yen seized in connection with 830m yen owed, were not Transcu's

The judgement is not expected to affect the CEO'S $10 million loan to Transcu, said its chief financial officer, Steve Kek, yesterday.

In June, Mr Matsumura had made an unsecured $10 million loan at 2 per cent interest per annum to Transcu for the company's working capital needs. This loan had followed the proposed issue of convertible notes that was expected to raise $80 million.

The group also clarified that Mr Matsumura's shares worth 527.3 million yen that were reported by The Straits Times yesterday as having been seized in connection with the 830 million yen owed, were not Transcu Group shares.

Where his role as Transcu's chief executive is concerned, it will be business as usual, according to Mr Kek.

'The execution of his role will not be affected by this case,' Mr Kek told BT yesterday.

In 1991, Mr Matsumura had acted as a guarantor for Tosho, a facial equipment and cosmetics firm, in the latter's joint venture with Brother Sales, which sells sewing machines and other products.

Tosho had borrowed three billion yen from its joint venture firm, Bellezza Club Japan (BCJ), in 1991 and had repaid part of it in instalments.

After winning a case in a Japanese court that ordered Mr Matsumura and other guarantors to repay some 1.49 billion yen, BCJ brought the case to the Singapore High Court to enforce the judgement against Mr Matsumura because of his assets here.

Currently, there are two other similar cases pending in the High Court.

Mr Matsumura had previously argued in the Japanese court that the guarantees were not valid, based on the claim that the monies were for the value of goodwill paid for Tosho during its joint venture with Brother Sales.

In the High Court here, his lawyer - P Nandakumar from Rajah & Tann - had argued against the enforcement, because there were still two related cases pending in Japan that could possibly support a move for a re-trial.

BCJ's lawyer - Alma Yong from Lee & Lee - said, however, that the Japanese verdict was a conclusive one.

Transcu's counter closed half a cent higher at $0.225 in trading yesterday.