GGRAsia – Lim brothers removed from Donaco’s board

Lim brothers removed from Donaco’s board

Jul 18, 2019 Newsdesk Latest News, Rest of Asia, Top of the deck, World

Shareholders of Australian operator of Southeast Asian casinos Donaco International Ltd have voted to remove directors Joey Lim Keong Yew (pictured) and Ben Lim Keong Hoe from the firm’s board.

The vote was held on Thursday at an extraordinary general meeting called by three shareholders that had asked for shake-up of Donaco’s board.

Donaco said in a filing to the Australian Securities Exchange (ASX) that more than 90 percent of the votes casted in Thursday’s meeting were in favour of the removal of the Lim brothers from the company’s board.

Mr Joey Lim is the founder and a former managing director and chief executive of Donaco. He was the chief executive and managing director of the company until March 19 when his employment was terminated “with immediate effect”. During his absence, Mr Ben Lim had stepped in as acting CEO. The brothers are scions of the family that founded Malaysia’s casino conglomerate Genting.

The firm appointed a new CEO, Paul Arbuckle, with effect from June 12.

In June, Donaco told the ASX that it had received a notice from shareholders Spenceley Management Pty Ltd – as trustee for, respectively, the Spenceley Family Trust and the Spenceley Family Superannuation – and from Antonia Caroline Collopy, calling for an extraordinary general meeting to consider resolutions to remove the Lim brothers from the board. The shareholders hold a combined stake of 5.04 percent of Donaco’s shares.

Investor James Spenceley and entities linked to him control circa 4.68 percent of Donaco. Mr Spenceley had been quoted by the Australian Financial Review newspaper as saying the exit of Mr Joey Lim Keong and his brother from the Donaco board “needs to happen for the company to get back on investor watch lists”.

Mr Spenceley has since May last year been the chairman of another Australia-listed Asian regional casino operator, Silver Heritage Group Ltd.

The two firms are not directly competing: Silver Heritage has its main business in a casino on Nepal’s border with India; Donaco has its main business in a venue called Star Vegas Resort and Club at Poipet, on Cambodia’s border with Thailand. But all Asian casinos are interested in vying for a finite pool of gamblers, particularly VIP ones, according to investment analysts.

A third party – that since late June controls a 19.25-percent stake in Donaco – has asked for two seats on the firm’s board. The stake had been held by a creditor to companies owned by Mr Joey Lim. The casino firm stated at the time that the size of stake involved would “under normal circumstances” entitle the holder to only one seat on the Donaco board, and that the company would prefer its board to be composed of a majority of independent directors.

Donaco said last month it expected to make a statutory net loss in its current financial year, adding that no dividends or buybacks would be permitted in its next financial year.