Enviro-Hub Holdings Pursues Major Legal Claim Over Failed Profit Guarantee in Pastel Glove Acquisition

Key Points from the Announcement

• Enviro-Hub Holdings Ltd. (SGX: L23) has taken significant legal action against a vendor due to a failed profit guarantee related to its acquisition of Pastel Glove Sdn. Bhd. (PGSB).
• The company acquired 75% of PGSB through its subsidiary, Enviro Healthcare Pte. Ltd. (EHPL), from vendors Law Siau Woei (LSW) and Choo Kuan Ping (CKP).
• Enviro-Hub is demanding MYR22,964,380 (approx. S\$6.95 million) from LSW for failing to meet the profit guarantee stipulated in the acquisition agreement.
• Breakdown of the claim includes adjusted net profit after tax shortfalls for 2023 and 2024, trade receivables/payables, and advances from LSW.
• After failed attempts to recover the amount via a Letter of Demand, Enviro-Hub has initiated legal proceedings in Malaysia, seeking not just repayment but also aggravated and exemplary damages and interest.
• The company has broadened its legal claim to include breaches of director and fiduciary duties against LSW.
• Shareholders are cautioned that the outcome of this lawsuit could materially affect the company’s financials and share price.

Details Retail Investors Must Know

Enviro-Hub Holdings Ltd. has issued a comprehensive update regarding its ongoing dispute with Law Siau Woei (LSW) over the profit guarantee tied to its 75% acquisition of Pastel Glove Sdn. Bhd. (PGSB). According to the company, the profit guarantee shortfall for 2023 and 2024 totals MYR25,891,818, with MYR22,964,380 currently outstanding after accounting for trade receivables, payables, and advances.

Legal Action Escalates

After LSW failed to respond to a formal Letter of Demand dated 9 June 2025, and made no payments, Enviro-Hub filed its first legal claim in Malaysia. On 4 August 2025, this claim was withdrawn and a fresh, expanded statement of claim was filed on 19 August 2025. The new lawsuit seeks:

• A court declaration of breach of contract by LSW
• Repayment of MYR22,964,380 to Enviro Healthcare Pte. Ltd. and PGSB
• Aggravated and exemplary damages to be assessed by the court
• Pre- and post-judgment interest at 5% per annum
• Legal costs on an indemnity basis
• General damages for breach of director/fiduciary duties, plus further damages and costs

This escalation increases the financial and reputational stakes for Enviro-Hub, as the company seeks to recover both the profit guarantee shortfall and additional damages.

Potential Impact on Shareholders

The outcome of this legal dispute is potentially price-sensitive. If Enviro-Hub successfully recovers the full amount and damages, it would strengthen the company’s cash position and reinforce its governance standards. Conversely, failure to recover the funds may result in a material loss and could weigh on investor sentiment. The company has warned shareholders and potential investors to exercise caution and consult professional advisers if uncertain about the implications.

Why This Matters – Price Sensitivity and Share Value

This update is highly relevant for shareholders and could move Enviro-Hub’s share price. The multi-million ringgit lawsuit, the expanded scope of damages sought, and the uncertainty about recovery all represent significant risks and opportunities. The company’s financial outcome is closely tied to the resolution of this dispute, making it a crucial watchpoint for retail investors.

Cautionary Statement from the Board

The Board has specifically advised shareholders and potential investors to refrain from taking any action that might prejudice their interests, and to pay close attention to future announcements. If you are unsure how this development affects your holdings, consult your broker or financial adviser.

Disclaimer

This article is a summary and analysis based on the latest public disclosures from Enviro-Hub Holdings Ltd. It does not constitute financial advice or a recommendation to buy, sell, or hold shares. Investors should consult their own professional advisers before making any investment decisions.

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