Maika Holdings chief executive officer S Vell Paari today said that he would step down from his post as soon as he has restored MIC's ailing investment arm.

"My intention is to clean up the company and restore it to a strong asset based company and then step down as a CEO.

"A new CEO will then be appointed to take over the company. The last few years, I have always made this intention quite clear," he said in a statement today.

He also said that at the company's annual meeting last year, the Maika board had proposed resolutions to sell off all assets of Maika and distribute the surplus to the shareholders.

"The company would have been in a position to buy back at a minimum of RM1 per share which also includes it bonus shares. However, that plan had to be put on hold due to injunction by a shareholder to stop us on acting on those resolutions," he said.

He added that Maika directors had had discussions with the particular shareholder in trying to come to an amicable solution.

EGM proposed

At the same time, Vell Paari said, the board has also submitted an application to the High Court seeking for a date to hold an extraordinary general meeting (EGM).

"The court has set Dec 2 as the date to hear our application and if successful, we would then immediately call for an EGM to approve the said resolutions and refund the monies back to the shareholders," he said.

Vell Paari was responding to criticisms levelled against the Maika management team by former Federal Territory MIC chief VKK Teagarajan yesterday.

Teagarajan said that a weak management was to be blamed for the financial woes of Maika. He also proposed that the government pumped in RM150 million to bail out Maika.

Teagarajan, who is vying for the post of deputy president in party polls next September, also said that some of the investors were forced to sell their shares at 30 sen.

On this, Vell Paari said that he would be asking his officers to liaise with Teagarajan to obtain more details on the 30 sen deals.

A new company to take over

He added that he was also aware of some unscrupulous people who were preying on innocent shareholders so that they can make a quick minimum 70 sen profit per share.

"We have always advised shareholders not to sell below RM1," said Vell Paari, who is the son of MIC president S Samy Vellu.

He also gave his personal opinion of the way forward for Maika, based on feedback he had received from investors were not interested to cash out and wanted the company to continue.

"I suggest that the funds of the remaining shareholders who have not taken up the offer to cash out be transferred into a new company and making these remaining shareholders the new shareholders of the new company.

"Maika Holdings would be liquidated and the remaining assets of Maika Holdings are to be transferred into the new company," he said.

He said that the new company would have a new set of board members appointed by the shareholders.

"The board members have to be appointed by at least 75 percent of the voting shareholders. At least 26 percent of its shareholders have to be spread among individuals.

"Major investment decision in the new company has to be approved by at least 75 percent of the shareholders present in the company meeting," he added.

He said that MIC too can play a role by urging the government to channel some projects into the new company.

Defending his record

Vell Paari also defended his track record as Maika's CEO.

"When I took over as the CEO in 1999, Maika was technically insolvent. Now with the help of the board, we have RM150 million in gross assets," he said.

He added that the government has been helpful in solving some of Maika's financial woes through the national asset management company Danaharta.

Maika, a brainchild of Samy Vellu, was established in 1982 purportedly to enable Indian Malaysians to have a share in the country's economic growth.

Some 66,000 investors had put in about RM106 million of their hard-earned cash into the venture.

However they have grown disillusioned after seeing little returns on their investments, with many accusing the company of squandering the capital through dubious channels.