PETALING JAYA: Puan Chan Cheong – founder of Green Packet Bhd, Malaysia’s first “unicorn” – has been declared a bankrupt by the Kuala Lumpur High Court for failing to settle a combined sum of RM30.66 million owed to two companies.
The ex-managing director of the telecommunications company had failed to meet the requirements of bankruptcy notices filed on May 24, 2022.
The bankruptcy order was issued on March 27 after an application by Medinis Sdn Bhd, as well as a petition by Everegion Sdn Bhd.
Puan, or better known as CC Puan, is said to owe some RM30.66 million to the two companies.
Of the total, RM22.86 million is owed to Medinis after the company exercised two put option agreements to dispose of 15 million G3 Global Bhd warrants, which had been converted to 60 million shares, to Puan.
He has another RM7.8 million payment unsettled with Everegion, which exercised a separate put option on Puan to dispose of five million G3 Global warrants which had been converted to 20 million shares.
According to an affidavit filed by Puan in October 2021, he claimed the put option agreements were merely a facade for a RM20 million loan from businessman Yip Yee Foo, who transferred the loan amount via his two nominees – Medinis and Everegion.
He claimed that the two companies were represented as licensed moneylenders.
Rise and fall of CC Puan
A graduate of the University of Nebraska-Lincoln with a degree in business administration, Puan, 54, founded Green Packet in 2000 and led it to its Main Market listing in 2005.
Starting out as a software solutions company, it later expanded into the broadband business. In 2007, it reached a market capitalisation of US$1 billion, granting it the coveted “unicorn” status.
Green Packet was pushing its rollout of worldwide interoperability for microwave access (WiMax) through Packet One Networks (P1). However, WiMax eventually lost out to the long-term evolution (LTE) broadband standard.
P1 was subsequently sold to Telekom Malaysia Bhd (TM) in 2014 for RM350 million, with a further RM210 million capital injection via newly issued redeemable bonds.
The sale saw TM gain a 57% controlling stake in P1 whilst Green Packet’s stake was reduced to 30%. As part of the deal, Puan remained head of the P1 unit in TM.
In 2016, he reportedly left the country for a “spiritual sojourn” in Nepal. But he returned home in 2018, and re-joined Green Packet in 2019 as CEO and managing director.
Through Green Packet, Puan emerged in 2016 as a substantial shareholder in G3 Global Bhd, which at the time was a loss-making jeans company. It is currently involved in technology and the supply of internet of things (IoT) connected objects.
Puan had ambitions to turn G3 Global into an IoT player and start an artificial intelligence (AI) park in Malaysia.
There was even speculation that G3 Global would receive the mandate from the government to take over Teknologi Park Malaysia (TPM).
However, the deals never materialised. G3 Global has remained in the red for the last five years, with a net loss of RM9.8 million for the financial year ended Dec 31, 2022.
For the fourth quarter ended Dec 31, 2022 – prior to a change of financial year – Green Packet posted a net loss of RM43 million.
At the close of trade today, G3 Global’s share price fell 16.7% or 0.5 sen to 2.5 sen, giving it a market capitalisation of RM78.6 million.
Green Packet’s share price was up 14.3% or 0.5 sen to 4 sen, giving it a market capitalisation of RM70.09 million, a far cry from its US$1 billion valuation in 2007.