The Employees' Provident Fund (EPF) recently hit the headlines after they sold six million shares of Cape EMS Bhd, a surprising move just weeks after becoming the largest shareholder in the company.
The sale has reduced the EPF's stake in Cape EMS to 4.44%, well below the 5% required for largest shareholder status.
The share price of Cape EMS has suffered a significant decline, plunging almost 40% from the time the EPF acquired 3.5 million shares in late July to its disposal in mid-August.
Cape EMS, listed on Bursa Malaysia in March 2023 at an IPO price of 90 sen, has seen its share price fall by 57% in the past month, hitting an all-time low of 40 sen.
The company's group Managing Director and Chief Executive Officer, Christina Tee, also reduced her holdings significantly, selling over 300 million shares in various transactions over the same period.
It is believed to be due to margin calls, driven by a sharp fall in share prices, prompting this disposal by both the EPF and other major shareholders.
The situation highlights the uncertainty and risk associated with equity investment, especially in newly listed companies.
