Malaysia

Sapura patriarch sues sons for shares, property

April 05, 2012

KUALA LUMPUR, April 5 — Sapura Group founder Tan Sri Shamsuddin Kadir has filed a suit demanding his two sons return shares and properties worth over RM450 million, The Edge Financial Daily reported today.

Court documents sighted by the daily did not state the reason for demanding the assets from sons Datuk Shahril and Shahriman, including a 15 per cent block in the family’s private investment vehicle, Sapura Holdings Sdn Bhd.

The suit comes as Sapura Group, which has roots in telecommunications, is set to become a regional player in the oil and gas sector with the proposed RM11.85 billion merger between SapuraCrest Petroleum and Kencana Petroleum.

Financial executives familiar with the court dispute said the suit filed in the Shah Alam High Court in late February will not pose any problems to the merger, which is set to create the country’s second largest O&G service provider.

“This is purely an internal family problem. There will be zero impact on the merger,” an executive with close ties to the Sapura family and who is involved in the proposed merger told the Financial Daily.

This is because Brothers Capital Sdn Bhd, the Sapura brothers’ private vehicle, owns 96 per cent of Sapura Holdings, controlling shareholder in the group’s listed entities such as SapuraCrest, Sapura Industrial and Sapura Resources.

Even if Shamsuddin succeeds in his court battle, his 15 per cent block would be no match for the 81 per cent combined interest held by his sons in the event of a shareholder dispute, financial executives close to the situation said.

It is understood that Shahril and his younger brother will file their response to the legal claims made by their father in the coming days.

Shamsuddin, a personal friend of former Prime Minister Tun Dr Mahathir Mohamad, is widely regarded as a poster boy of the National Economic Policy (NEP).

He set up the Sapura group in 1975 and was the driving force behind the group’s transformation into a major player in the local telecommunications sector, before diversifying into auto parts manufacturing and technology training.

Shahril, who joined the company in 1985 before becoming president in 1999, is credited with Sapura’s push into O&G and defence-related industries.

Shahril and Shahriman now run the group after their father retired last year.

Corporate executives and politicians with close ties to the family said the relationship between the father and sons grew distant after Shamsuddin’s wife died in 2004.

Shamsuddin’s relationship with his sons has become more strained since he remarried four years ago.