Viz Branz's family feud to finally end

It's a father-son dispute over 15% stake.

According to OCBC, Viz Branz announced on Friday that former CEO and current top shareholder Chng Khoon Peng has unreservedly dropped all his earlier allegations of impropriety over a series of payments involving the company that prompted him to lodge a complaint with the Commercial Affairs Department (CAD) in Mar 2012.

Here's more from OCBC:

Mr Chng will now withdraw his complaints with the CAD and will no longer pursue them further. He acknowledges that he has "no further basis nor concerns for his allegations" after being provided with explanations and supporting documents by VB.

The withdrawal of the complaint concludes another chapter (the last, it is hoped) of the feud between Mr Chng and his son, VB’s current CEO.

Previously, the two had a long-running dispute over a 15% stake in the company, which was ultimately resolved in favour of the elder Mr Chng.

We deem this latest development as a positive event that coincides with the possibility of a general offer by Lam Soon Cannery Pte Ltd, which now has an estimated 20.06% stake in VB (after increasing its stake from 19.8% with open market purchases when the price dipped).

All signs now point to an impending offer for VB from Lam Soon – there are no more public family disputes outstanding; its current CEO’s stake has been reduced, suggesting his intent to exit the business; and VB did not declare a dividend for FY12.

The recent share-price appreciation of consumer-related companies such as Super Group and Food Empire [both not rated] has caused some fluctuations and sell-offs in VB as investors become impatient and disappointed with the lack of progress.

We urge investors not to be disheartened and reiterate our belief that a general offer is approaching. Furthermore, the fundamentals for VB remain unchanged in the medium-term and its FY13 growth projections are strong.