Business
Quiet Change In Ownership Of Carpenters/MH Group
But who is the ultimate owner?
There’s been a quiet change in ownership of one the South Pacific’s historically significant business organisations—the Carpenters/Morris Hedstrom group.
But who is the ultimate owner? It appears to be Dr Mogan Lourdenadin, now chief executive officer of an old Australian registered holding company.
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His name began popping up in Suva from early 2002 as the prospective new owner of Carpenters, which is big in business in Papua New Guinea and Fiji, and owns the Morris Hedstrom store in Samoa.
According to Australian financial journalist Trevor Sykes, writing in his Pierpont column, Lourdenadin named by Sykes as Ninian Lourdenadin, has a company called Corali Securities Ltd, which since February 1, 2002, has had a five-year contract for the sole and exclusive management of the Carpenters group in the South Pacific.
Sykes wrote that all that he knew about “Ninian” was that “he holds a medical degree from the University of London and he’s the chief executive of the Nadin investment companies in Switzerland, which sounds like his own family group. It’s certainly a private group, because a Google search reveals no information on either Nadin or Ninian.”
Suva businessmen who have encountered Lourdenadin said he’s an Indian businessman who appeared to be headquartered in London.
“He’s a fairly mysterious sort of a guy. No one knows much about him,” was one comment.
In December, representatives of the new owners of Carpenters appeared in Suva and held a media conference at which they announced that F$60 million (US$27.6 million) would be invested in building a 21-floor shop and office complex on a three-acre site in the heart of Suva occupied by a two-floor Morris Hedstrom store destroyed by a fire four years ago.
Martin Haeger, executive director of MBf Holdings Berhad, quoted by the local media, said the building would be completed in the third quarter of 2004 and half of its 135,000 square feet of floor space would be taken by Carpenters for the centralisation of the Pacific Islands business in Fiji, rather than, said another representative, Mark Bennett, described as estate manager for Nadin, the holding company of MBf, in Australia or Papua New Guinea.
Islands Business wasn’t invited to the media conference. Contacted by telephone, Haeger agreed to an interview but this was later cancelled because Islands Business was told, Haeger was too busy.
Daniel Whippy, deputy managing director of Carpenters Fiji Ltd, the company’s chief local representative, agreed to put written questions from Islands Business to the new owners. Replies had not been received by the time Islands Business went to press.
The Carpenters/Morris Hedstrom group has South Pacific origins that date back to the 1870s in Fiji.
The business was controlled for many years by an Australian family business, W.R. Carpenters Holdings, and sold in the 1980s to another Australian businessman, Ric Stowe. Stowe sold off many of the Fiji businesses and assets and then sold the remaining Pacific Islands businesses to a Malaysian buyer, Malaysia Borneo Finance (MBf).
MBf’s chief appeared once in Suva to announce plans for substantial investment in a wide range of manufacturing and other businesses. None of these happened.
In Malaysia, the parent company a few years later collapsed financially to fall under the control of Malaysia’s central financial authority.
MBf invested in a few new Morris Hedstrom stores in Fiji and in MBf Finance, a company run by a Malaysian manager who left Fiji hurriedly after the catastrophic F$240-million collapse of the government-owned National Bank of Fiji.
MBf Finance had set up a credit card business with National Bank under an arrangement that placed all risks with the bank.
The Pacific Islands Carpenters/Morris Hedstrom business continued under chief executive Ken Clemens, an accountant and respected old hand from the palmy days of the Australian-owned era of Carpenters. Clemens, who travelled constantly between Suva and Port Moresby to keep the business running, retired in mid-2002.
He was replaced briefly by an Australian businessman, Gary Marsh, who was involved with Lourdenadin in buying the Pacific Islands business from the wreckage of the ultimate Malaysian owner. Marsh left Suva after a few months.
In Papua New Guinea, Carpenters owns coffee and copra plantations and is in automotive sales and servicing, hardware merchandising and investment.
In Fiji, it runs the Morris Hedstrom chain of retail stores, the Carpenters Motors chain, a shipping agency, a finance company and homeware stores. Its main profit centres are reportedly the shipping agency and motor division.
The group employs about 5000 people in Papua New Guinea, nearly 2000 in Fiji, and about 150 in Samoa.
The scale of the 21-floor planned Suva building, twice the height of any other building in Fiji, came as a surprise to the local business community in view of what looks like an impending long period of a glut of space in the city due to the construction of several ultimately government-underwritten buildings underway or planned.
There’s also curiosity about the source of finance for the F$60–million project.
According to the Pierpont article, based on the latest half-yearly report of the Sydney listed MBf Carpenters Ltd, the company lost money in the three of the seven years to 1997, made A$8 million in 1998, lost A$7 million in 2000/2001—“a pretty dismal performance considering that MBf has total assets with a book value of A$126 million.
MBf Asia Capital Corporation Holdings of Malaysia owns 95.96 percent of the issue capital of MBf Carpenters, with 20 other top but small investors having Malaysian and Chinese names.
Lourdenadin gets an annual A$400,000 management fee plus 30 percent of all operating profits above A$1,385,000 a year, according to the Pierpont article. On the company’s present profitable performance, this should produce a total fee of just of A$1 million for 2002, Pierpont estimates.
Dwelling on what it describes as mystifying aspects of the management deal, the article comments: “It’s almost as though the Malaysians have sold Ninian their 96 percent share of MBf. But this cannot be so, because there has been no notification to the Australian Stock Exchange.”
It’s unlikely the four percent of minority shareholders can expect dividends from the South Pacific soon, Pierpont comments, since a “series of corporate manoeuvres” had bought out 500-million MBf shares issued.
“The company would need to make more than A$5 million profit just to pay out once cent.”
