Quick take: London Biscuits shares up 16% despite default risk

KUALA LUMPUR: LONDON BISCUITS BHD’s shares rose 16.6% in early trade Wednesday although the company announced that it has defaulted its principal payments to RHB Bank.

The confectionery manufacturer, one of the most active counters, advanced 16.67%, or 1.5 sen to 10.5 sen with 7.7 million shares traded.

London Biscuits has defaulted on principal payments to RHB Bank that amounted to RM22.52mil.

It said the default, dated Oct 2, was due to “cash flow constraint”.

“The company is currently assessing the significant impact of the default in payment on the business, financial and operations of the remaining business of the group, ” it added.

The group previously announced that it had defaulted on payments amounting to RM89.19mil to seven banks between June 19 and Sept 20 this year.

The seven banks are Bank Islam Malaysia Bhd, Bank of China (Malaysia) Bhd, Malayan Bank Bhd, United Overseas Bank Bhd, OCBC Bank (Malaysia) Bhd, OCBC Al-Amin Bank Bhd and HSBC Bank Malaysia Bhd.

The group is currently facing a winding-up petition. Lim San Peen of PricewaterhouseCoopers Advisory Services Sdn Bhd has been appointed the interim liquidator.

Source: TheStar