Barang Barang goes bust
After filing for voluntary liquidation in February, famed furniture maker Barang Barang announced its Managing Director Lim Kok Hui had resigned “for new prospects” as facebook customer groups go nuts.
Barang Barang was the preferred hangout for many Expat wives and their maids on the weekend shopping for new furniture and that perfect patio ornament.
But low prices hid a deeper secret – the firm was going bust, and now its customers, many of whom prepaid for furniture, are left without a sofa to sit on.
Facebook anti-fans
On facebook an anti-fan site called “Singapore Consumers vs Barang Barang (and parent co KLW Holdings)” had this to say, “Before folding they lured many new customers with clearance sales, taking the cash and promising delivery at a later date. Chances are, Barang Barang already knew they were insolvent, and used the sales to raise cash for their parent company to repay debt.
Creditors are now lining up to file their claims against Barang Barang.
If you’ve bought something from Barang Barang, we need consumers to band together, file a joint complaint with CASE, and make some noise - or never see the cash let alone furniture that we paid for.”
But facebook complaint sites may not be the only difficulties facing the company that owns Barang Barang.
Parent company of Barang Barang, KLW Holdings, is run by executive chairman Lee Boon Teck. It should be noted that the MD, who just resigned, is the brother in law of the executive chairman Lee Boon Teck and the son in law of Mr Lee Choon Tai, a substantial shareholder of KLW.
In an explanation to investors, managing Director Lim’s brother-in-law, executive chairman Lee Boon Tuck, said the board of directors and management “wish to thank Mr Lim Kok Hui for his invaluable past contributions to the company.”
So what next for KLW?
KLW reported it lost $5.7 million in 2009, and this on top of a $3 million loss in 2008. The group only had less than a million cash in the bank at December 2009 and had a loan or loans worth $14 million due sometime 2010.
One of the bank loans of $4.4 million was guaranteed by the company and also certain directors of the subsidiaries.Of course these figures, which were contained in public records released March 1, state that they have not been audited or reviewed by the company’s auditors, and there appears to be no updates since. And as for who will now be an independent director of KLW now that Mr Lim stepped down? None other than the Audit Committee Chairman, Mr Ho Pong Chong.
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