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Fire is used to claim insurance when the business is bad

Insider in furniture industry told me fire is used to claim the insurance before the company is shut down permanently. Valuable goods are shipped out before fire.

Lii Hen shares fall after fire at Muar factory

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KUALA LUMPUR: Shares of furniture maker Lii Hen Industries Bhd fell to a low of RM1.73 at the midday break on Friday on concerns about the operation impact from a fire at its Muar factory.

At 12.30pm, it was down six sen to RM1.76. There were 211,100 shares done at prices ranging from RM1.73 to RM1.80.

The FBM KLCI was up 1.86 points to 1,857.49. Turnover was 1.07 billion shares valued at RM1.23bil. There were 347 gainers, 374 losers and 327 counters unchanged.

Lii Hen said a fire broke outat the factory of Lii Hen Furniture Sdn Bhd in Kawasan Perindustrian Bukit Pasir, Muar at 6.50pm on Thursday.

The premises comprised of three blocks of single-storey factory building with a three-storey corporate office. Though the fire was brought under control at about 9pm, it had already destroyed two of the blocks, machinery, conveyor system and a spraying plant. Also affected were semi-finished products.

Lii Hen said the property, plant and equipment and inventory, which had been destroyed, were adequately insured.

“This incident will have operational impact on bedroom sets operations of the group. The financial impact of this incident is being assessed and the announcement will be made once it has been determined.

“The potential impact on the earnings of the group will be mitigated as it is insured against consequential loss at an amount of compensation, which will be determined by the loss adjusters in due course,” it added.

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