Disposal, Share Consolidation, Placing, GM Notice
8 September 2020
RNS ANNOUNCEMENT: The information communicated in this announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.
NEW TREND LIFESTYLE GROUP PLC
("NTLG" or "the Company" or "the Group")
(to be re-named Conduity Capital plc)
Disposal of New Trend Lifestyle Pte. Ltd
Consolidation of Share Capital, Conditional Placing of New Ordinary Shares, Grant of New Investor Warrants, Amendment of Articles of Association, Change of Name and Notice of General Meeting
NTLG announces the Disposal of its 85.71 per cent. owned subsidiary, New Trend Lifestyle Pte. Ltd, which is subject, inter alia, to Shareholders' approval at a General Meeting which is to be held at 10.15am on 1 October 2020 at the offices of Bracher Rawlins LLP, 77 Kingsway, London, WC2B 6SR. In addition, the Company is proposing a 10 for 1 share consolidation of the Company's ordinary shares and a conditional placing with new investors, through the Company's broker Peterhouse Capital Limited, to raise £1,000,000 before expenses, through the issue of 100,000,000 New Ordinary Shares at the Issue Price, together with the grant of 50,000,000 Investor Warrants to the participants in the Placing. The Consolidation will require an amendment to the Company's Articles of Association to amend the nominal value of the Existing Ordinary Shares of £0.001. Subject to the approval of the Consolidation, there will be a Resolution (Resolution 3) proposed as a special resolution to amend this reference to a nominal value of £0.01.
In addition, the Company currently has insufficient authority to dis-apply statutory pre-emption rights and therefore the Company is seeking Shareholder approval to give the Directors the authority to allot the Placing Shares, the Investor Warrants and the Broker Warrants and to dis-apply statutory pre-emption rights in respect thereof.
The Disposal will represent a fundamental change of business, as well as a related party transaction, under the AIM Rules for Companies following completion of which, the Company will become an AIM Rule 15 cash shell.
The purpose of the Circular is to provide you with details of the Proposals, to explain the background to and the reasons for the Proposals and why all Directors recommend that Shareholders vote in favour of Resolutions 2, 3, 4, 5 and 6 and the independent directors (in respect of the Disposal) recommend that Shareholders vote in favour of Resolution 1, all to be proposed at the General Meeting.
The Proposals are all conditional, inter alia, on the passing of the Resolutions by Shareholders at the General Meeting, notice of which is set out in the Circular. If the Resolutions are passed, admission of the Placing Shares to trading on AIM is expected to occur on or about 8.00 a.m. on 2 October 2020.
Additionally, the Annual General Meeting of the Company is scheduled for 10.00 am on 1 October 2020, and the Report and Accounts for the year ended 31 December 2019 and notice of meeting has been sent today to shareholders.
The Circular, and notices of meeting for the Annual General Meeting and General Meeting are available on the Company's website: www.newtrendlifestylegroup.com.
Proposed format of the General Meeting
At the time of publication of this Document there is the risk associated with holding a physical general meeting given social distancing requirements and the various other provisions that follow from Covid-19. The Company is monitoring the announcements by Department of Business, Energy and Industrial Strategy, Financial Conduct Authority and the Financial Reporting Council and others on such issues and are following their advice when taking decisions on holding physical meetings. The current situation following the enactment of the Corporate Insolvency and Governance Act 2020 sets out that companies may hold closed general meetings up to 30 September 2020, however, it is the Company's understanding that it is likely that these measures will be extended for a further three month period (to be confirmed by the UK Government). On that basis , together with the continuing risk of localised restrictions means that the Company has taken the decision that a conventional general meeting is not practical unless both the coronavirus (COVID-19) situation and the applicable guidance have changed prior the date of the meeting. Unless Shareholders are notified otherwise by the Company prior to the date of the meeting, the alternative arrangements for the General Meeting, including voting, set out in the Notice of General Meeting in the Circular shall apply to this meeting.
Definitions in this announcement have the same meaning as in the Circular to Shareholders dated 8 September 2020.
For further information:
New Trend Lifestyle Group Plc
Gregory Collier, Non-Executive Chairman
+44 (0) 7830 182501
SPARK Advisory Partners Limited (NOMAD)
Mark Brady/Neil Baldwin
+44 (0) 20 3368 3550
Peterhouse Capital Limited (Broker)
Heena Karani/Lucy Williams
+44 (0) 20 7496 0930
Background to and reasons for the Disposal and Placing
The Company has been seeking to grow through acquisition for a number of years, with a view to mitigate against the decline in sales and shareholder value as a result of difficult trading conditions facing its existing business in Singapore. Notwithstanding the efforts that have been made in this respect, the Company has not been able to identify a suitable acquisition target to date and, as a result, the Board believes that the costs of being an AIM quoted company has not benefitted the Group.
Furthermore, on 14 April 2020, the Company issued a trading update which included a notification that the Singapore Government had announced that all non-essential businesses would be closed from 7 April 2020 for one month to combat the spread of the COVID-19 virus. This measure meant that the Group's operations were closed for that period. The Singapore Government subsequently extended this measure and shops were only allowed to re-open on 19 June 2020. The Directors believe that the Group's unaudited revenue for the six months ending 30 June 2020 will be significantly below that of the same period last year and trading since our re-opening has not yet recovered to pre-COVID-19 virus levels. The uncertainty created by this extended measure, and our trading since 19 June, has made it very difficult to assess the outlook and prospects for the business in its current form.
Accordingly, the Board believed that it was faced with the following alternatives:
· Fundraising for existing business: given the current and continuing situation, the Board does not believe it will be able to raise additional external equity and/or debt to fund the Group's current activities or invest in the development of its trading business, if the Company were to remain as an AIM-traded company;
· De-listing: the Board has considered seeking the cancellation of its admission to trading on AIM ("De-listing") given the costs of maintaining the listing, but then there would effectively be no market in the Ordinary Shares, which could penalise Shareholders; or
· Disposal: the Company could dispose of New Trend Lifestyle Pte. Ltd to the Company's CEO, Phang Song Hua, introduce new funds into the Company (which would have become an AIM Rule 15 cash shell), and look to adopt a new investing strategy, by seeking a reverse takeover, to try and recover value for the Shareholders.
Having considered the alternatives in detail with its advisers, Ajay Rajpal and Gregory Collier (as the independent directors in respect of the proposed Disposal) concluded that the best option for Shareholders would be to dispose of its Singapore subsidiary, New Trend Lifestyle Pte. Ltd, and raise additional funds to consider new business opportunities and search for a potential acquisition. It has been clear that the ability of the Company to raise significant funds historically has been difficult due to the recent trading history of the Group. No acquisition targets have been identified at this time; however, a significant cash injection will enable the Company to accelerate the search for new opportunities. No geographical or industry limitations have been set in the search for a target, which as an AIM Rule 15 cash shell is required to be a reverse takeover under the AIM Rules.
Details of the Disposal
The Company is proposing to dispose of their 85.71% owned subsidiary New Trend Lifestyle Pte. Ltd to Phang Song Hua, a substantial shareholder and Chief Executive Officer of the Company. This will result in New Trend Lifestyle plc becoming an AIM Rule 15 cash shell.
Summary of the Disposal Agreement
Against this background as set out above, the Company has today entered into a conditional sale and purchase agreement ("SPA") with Phang Song Hua for the sale by the Company of all the shares it holds in New Trend Lifestyle Pte. Ltd (representing 85.71% of the total shares). There are currently no guarantees between the Company and New Trend Lifestyle Pte. Ltd, so following the disposal the Company will not be responsible for its liabilities.
As at 31 December 2019, New Trend Lifestyle Pte. Ltd had net audited liabilities of S$6,251,736 gross assets of S$6,995,647, resulting in audited Net Assets of S$743,911. For the year ended 31 December 2019, New Trend Lifestyle Pte. Ltd made a profit before tax of S$665,123. The consideration for New Trend Lifestyle Pte. Ltd will be satisfied by a payment of S$100 (one hundred Singapore Dollars). In addition, as part of the SPA completion arrangements, a loan of S$1,145,099 (approximately £632,651) owed by the Company to New Trend Lifestyle Pte. Ltd will be cancelled. The SPA contains warranties only as to capacity and authority and title from the Company and no other warranties from the Company.
The SPA is conditional on the passing of Resolutions 1, 4 and 5, (which will include including the approval of Resolution 1 approving the Disposal by the Independent Shareholders), and the successful completion of the Placing.
The Disposal is subject to the approval of the Independent Shareholders at the General Meeting (Resolution 1), and Phang Song Hua is not permitted to vote his Existing Ordinary Shares on this Resolution.
Phang Song Hua is regarded as a related party under the AIM Rules as he is a Director and a substantial shareholder in the Company. As such the Disposal is required to have been considered by the independent directors in respect of the Disposal, Gregory Collier and Ajay Rajpal, in consultation with the Company's nominated adviser, SPARK.
Further information on New Trend Lifestyle Pte. Limited
New Trend Lifestyle Pte. Ltd is the main trading subsidiary of the Group and was incorporated in the Republic of Singapore on 4 November 2005.
Proposed Share Consolidation
The Company has announced a proposal for the 10 for 1 share consolidation of the Company's ordinary shares.
The Company's issued ordinary share capital currently consists of 225,000,000 Existing Ordinary Shares of 0.01p each in the capital of the Company ("Existing Ordinary Shares"). It is proposed to consolidate every 10 of the Existing Ordinary Shares into one Ordinary Share of 1.0p ("Ordinary Share").
Following the Consolidation (ignoring, for this purpose, the Placing Shares), there will be 22,500,000 Ordinary Shares in issue. Holders of Existing Ordinary Shares ("Existing Shareholders") should note that while the numbers of shares held by them will change, the proportion of the issued ordinary shareholdings in the Company held by each Existing Shareholder immediately before and after the Consolidation will, except for fractional entitlements, be unchanged.
Any Existing Shareholders holding fewer than 10 Existing Ordinary Shares at 6.00 p.m. on 1 October 2020 (or such later date as the Directors may determine and communicate to Shareholders by an appropriate announcement to a Regulatory Information Service) ("the Record Date") will cease to be a Shareholder of the Company.
Following the Consolidation, it is proposed that the Placing will take place.
The rights attaching to the Ordinary Shares will be identical in all respects to those of the Existing Ordinary Shares.
Should the Consolidation be approved at the General Meeting the Ordinary Shares will require new ISIN and SEDOL numbers from Admission; the new ISIN Number for the Ordinary Shares will be GB00BMX66220 and the new SEDOL number BMX6622.
Following the Consolidation, Share Certificates in respect of Existing Ordinary Shares will no longer be valid. Share Certificates in respect of the Ordinary Shares will be issued following the Consolidation or, in the case of uncertificated holders, Euroclear (UK and Ireland) Limited will be instructed to credit the CREST participant's account with Ordinary Shares.
New Certificates in respect of the Ordinary Shares will be despatched to all Shareholders by first class post at the risk of the Shareholder.
In order to effect the Consolidation, in addition to Resolution 2, the Company proposes to amend the Company's articles of association pursuant to Resolution 3, which would amend the reference in Article 6.1 of the Articles to a nominal value of the ordinary shares in the Company from £0.001 to £0.01.
AIM Rule 15
In accordance with AIM Rule 15, the Disposal constitutes a fundamental change of business of the Company. On Completion, the Company would cease to own, control or conduct all or substantially all, of its existing trading business, activities or assets.
Following completion of the Disposal therefore, the Company will become an AIM Rule 15 cash shell and as such will be required to make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14 (including seeking re-admission as an investing company (as defined under the AIM Rules)) on or before the date falling six months from completion of the Disposal or be re-admitted to trading on AIM as an investing company under the AIM Rules (which requires the raising of at least £6 million), less the consideration received failing which, the Company's Ordinary Shares would then be suspended from trading on AIM pursuant to AIM Rule 40. Admission to trading on AIM would be cancelled six months from the date of suspension should the reason for the suspension not have been rectified.
As such a cash shell the Company would also have no operating cash flow and would be dependent on the net proceeds of the Placing, and any subsequent exercise of Investor Warrants or Broker Warrants, for its working capital requirements. The Company's ability to raise further funds will depend on the success of existing and acquired investments. The Company may not be successful in procuring the requisite funds on terms which are acceptable to it (or at all) and Shareholders' holdings of Ordinary Shares may be materially diluted in due course by subsequent equity issues.
AIM Rule Deadlines - Reverse Takeover
Any failure in completing an acquisition or acquisitions which constitute(s) a reverse takeover under AIM Rule 14 (including seeking re-admission as an investing company (as defined under the AIM Rules)) will result in the cancellation of the Company's Shares from trading on AIM.
The Company will be dependent upon the ability of the Board to identify suitable acquisition targets. As at the date hereof, the Directors have not identified any investment opportunities which they have resolved to pursue. There is no guarantee that the Company will be able to acquire an identified opportunity at an appropriate price, or at all, as a consequence of which resources might have been expended fruitlessly on investigative work and due diligence.
Market conditions may have a negative impact on the Company's ability to make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14. There is no guarantee that the Company will be successful meeting the AIM Rule 15 deadline as described above.
The Company expects to incur certain third-party costs associated with the sourcing of suitable acquisition or acquisitions. The Company can give no assurance as to the level of such costs, and given that there can be no guarantee that negotiations to acquire any given target business will be successful, the greater the number of deals that do not reach completion, the greater the likely impact of such costs on the Company's performance, financial condition and business prospects.
Details of the Placing
To preserve some prospect of future value for Shareholders, as announced on 8 September 2020, Peterhouse has conditionally raised £1,000,000 before expenses through the Placing for the Company relating to the proposed allotment of New Ordinary Shares by the Company at the Issue Price, together with one Investor Warrant for every two Placing Shares. Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM, subject to approval of the Resolutions. It is expected that Admission will become effective and that dealings in the Placing Shares, will commence on AIM at 8.00 a.m. on or around 2 October 2020. The Placing Shares will represent approximately 81.63 per cent. of the ordinary share capital of the Company in issue immediately following Admission.
Subject to Admission being passed, Peterhouse will receive warrants over 3 per cent. of the Company's share capital from time to time at par for a period of three years from Admission, as part-payment for the introduction of incoming investors. In practice this means that at Admission the Broker Warrants shall be rights to subscribe for up to 3,675,000 Ordinary Shares. If there are any further allotments of shares prior to the expiry of the Investor Warrants, Peterhouse will be granted further Broker Warrants to ensure that the Broker Warrants continue to be over 3 per cent. of the Company's share capital (less any Ordinary Shares that have been issued to Peterhouse following any previous exercise of Broker Warrants).
If the Placing is fully subscribed, this would result in the allotment of 100,000,000 New Ordinary Shares (i.e. following the Consolidation) in the Company at the Issue Price.
Consequences of Placing for the Existing Shareholders
Following completion of the Placing, the proportion of the Ordinary Shares held by the Existing Shareholders shall be approximately 18.37 per cent. of the total issued ordinary share capital of the Company.
All Placing Shares will be issued credited as fully paid and will rank pari passu in all respects with the Ordinary Shares (i.e. the ordinary shares following the Consolidation), including the right to receive all dividends and other distributions declared on or after the date on which they are issued. For each two Placing Shares acquired by a participant in the Placing, that participant shall be granted one Investor Warrant providing a right to subscribe for a new Ordinary Share at a subscription price of 1.5p per share. In total, subject to completion of the Placing, there will be up to 50,000,000 Investor Warrants granted. The Investor Warrants shall be exercisable for a period of 12 months, after which any unexercised Investor Warrants shall lapse. If at any time prior to the lapse of the Investor Warrants the share price for the Ordinary Shares is 1.5p or more for five consecutive days, the Company shall have the option to require the holders of the Investor Warrants to exercise the Warrants within 14 days or their Investor Warrants will lapse.
For details as to the expected date and times by which certain events (e.g. Admission, the crediting of CREST accounts and the despatch of share certificates) are expected to happen in relation to the Placing Shares, please refer to the information on page 5 (Expected Timetable of Principal Events) of the Circular.
Related Party Transactions
The Disposal also constitutes a related party transaction under Rule 13 of the AIM Rules for Companies. Gregory Collier and Ajay Rajpal, the independent directors in respect of the Disposal, consider, having consulted with SPARK, the Company's Nominated Adviser, that the terms of the Disposal are fair and reasonable insofar as the Company's Shareholders are concerned. The independent directors in respect of the Disposal have taken into account the following:-
1. New Trend Lifestyle Pte. Ltd is currently loss making and the Company's base case internal projections show that there is no immediate prospect of an improvement in financial performance;
2. The findings of a private independent valuation report, commissioned by the Company, of New Trend Lifestyle Pte. Ltd; and
3. the Disposal, as it is a fundamental change of business, will be subject to Shareholders' approval at the General Meeting.
The independent directors in respect of the Disposal have also taken into account the principal relevant considerations that they have identified, which are set out further in the Circular.
In addition, Gregory Collier and Phang Song Hua, who are independent, have approved settlement terms with Ajay Rajpal in respect of his loss of office, to be documented in a settlement agreement, which includes a termination payment of £30,000 (the "Settlement"). The Settlement, which is conditional on the passing of the Resolutions, constitutes a related party transaction under Rule 13 of the AIM Rules for Companies. The independent directors in respect of the Settlement, Phang Song Hua and Gregory Collier consider, having consulted with SPARK, the Company's Nominated Adviser, that the terms of the Settlement are fair and reasonable insofar as the Company's Shareholders are concerned.
The Directors expect that, with effect from Admission, Nicholas "Nick" Lee will join the Board as a non-executive Director, and that Phang Song Hua and Ajay Rajpal will resign from office. Gregory Collier will remain on the Board as Chairman.
Nick Lee has over 30 years of experience in international investment banking and working as a company director. He qualified as a chartered accountant with Coopers & Lybrand and has a degree in engineering from St John's College, Cambridge. He worked for Dresdner Kleinwort and its antecedent firms from 1988 to 2009, rising to Managing Director, Head of Banking, Hedge Fund Solutions Group. During this period, he advised leading companies from a number of different industries. Since then he has been actively involved in AIM as a director of a number of listed companies.
Further announcements regarding the proposed Board changes will be made as appropriate.
Dis-application of Pre-Emption Rights and authority to allot shares
In connection with the Placing and the possible allotment of the Investor Warrants and the Broker Warrants, the Directors wish to have authority to issue a limited proportion of the Company's issued ordinary share capital without having to seek Shareholders' approval. Having such authorities will allow the Company to raise capital or issue shares for other reasons quickly and flexibly and without incurring the time and expense of convening a general meeting. The Directors believe that, at the current time, authorities in respect of 63.27 per cent. of the Company's issued ordinary share capital (following the Consolidation and the allotment of all the new shares relating to the Placing and the issue of the Investor Warrants and the Broker Warrants) will provide the Company with a reasonable capacity to issue shares.
Shareholders' approval is being sought for these Share authorities by way of Resolutions 4 and 5 in respect of the Placing and an addition authority up to £463,250.00.
Change of Name
The Board has agreed with New Trend Lifestyle Pte. Ltd that the Company's name will be changed to Conduity Capital plc (TIDM: CCAP), conditional on Shareholders' approval at the General Meeting.
Under the Companies Act 2006 and the Company's Articles, a change of name requires the passing of a special resolution of Shareholders at a general meeting. Shareholders' approval is being sought for this change of name by way of Resolution 8.
If Resolution 8 is approved, the change of name will be effective once Companies House has issued a new certificate on the change of name.
If approved the Company's TIDM will change to "CCAP" with effect from Admission.
Any person who is in any doubt as to his tax position or who is subject to tax in a jurisdiction other than the United Kingdom is strongly recommended to consult his professional tax adviser immediately.
Use of Proceeds
The Company is raising funds to enable the Board to search for acquisition opportunities, which if successful would constitute a reverse takeover under the AIM Rules for Companies and fund the Company's general working capital.
The Company is seeking Shareholders' approval at the General Meeting in respect of the following Resolutions:
· Resolution 1 which will be proposed as an ordinary resolution, seeks approval by the Independent Shareholders of the Disposal, pursuant to the SPA.
· Resolution 2 which will be proposed as an ordinary resolution and be subject to the passing of Resolution 3 relating to the amendment of the Articles, seeks approval for the Share Consolidation.
· Resolution 3 which will be proposed as a special resolution and be subject to the passing of Resolution 2 relating to the Consolidation, seeks approval for the amendment of the Articles to amend the reference to the nominal value of the ordinary shares to £0.01.
· Resolution 4 which will be proposed as an ordinary resolution seeks authority for the Board, pursuant to sections 551 and 570 of the Companies Act 2006, to allot, inter alia, the Placing Shares, the Investor Warrants and the Broker Warrants and the ability to issue additional Ordinary Shares up to a maximum nominal amount of £463,250.00.
· Resolution 5 which will be proposed as a special resolution seeks approval for the disapplication of pre-emption rights in relation to the issue of the Placing Shares, the Investor Warrants and the Broker Warrants and a further Ordinary Shares up to a maximum nominal amount of £463,250.00, under the authority granted by Resolution 4 such that such shares can be offered other than pro rata to existing Shareholders.
· Resolution 6 which will be proposed as a special resolution, seeks to approve the change of the Company's name to Conduity Capital plc.
In the event that Resolutions 1, 4 and 5 are not passed, the Disposal will not proceed.
In the event that Resolutions 2 and 3 are not passed, the Share Consolidation will not proceed.
In the event that Resolutions 4 and 5 are not passed, the Placing will not proceed.
In the event that Resolution 6 is not passed, the change of name to Conduity Capital plc will not proceed.
The new authorities are being sought predominately to allow the Company to complete the Placing, allow the allotment of any Ordinary Shares pursuant to the exercise of the Investor Warrants and/or Broker Warrants and to enable the Board to take advantage of future business opportunities as they arise.
In order to obtain the necessary Shareholders' approval, a General Meeting of the Company is to be held at which the Resolutions will be proposed. Further information regarding the General Meeting is set out in paragraphs headed General Meeting and Action to be taken by shareholders below.
The Directors, and the independent directors where appropriate, believe the Proposals to be the most appropriate way to provide the necessary capital to meet the Company's future requirements. Should the Disposal not proceed for any reason, the Company would seek to delist from AIM. Should the Placing not proceed for any reason, the Company would need to find alternative funding to fund its acquisition plans which, given the current global uncertainty arising from COVID-19, may create unnecessary uncertainty. All Directors, where appropriate, therefore recommend that Shareholders vote in favour of the Resolutions set out in the Notice relating to the Proposals.
A notice convening the General Meeting to be held at the offices of Bracher Rawlins LLP, 77 Kingsway, London, WC2B 6SR at 10.15 a.m. on 1 October 2020 is set out at the end of the Circular.
Action to be taken by Shareholders
You will find enclosed with the Circular a Form of Proxy for use at the General Meeting. You are requested to complete and return the Form of Proxy to Link Group, 34 Beckenham Road, Beckenham Kent BR3 4TU, in accordance with the instructions printed thereon as soon as possible but, in any event, to be received no later than 10.15 a.m. on 29 September 2020. Following current guidance on social distancing, the Company has concluded it will not be possible for shareholders to attend the General Meeting in person unless both the coronavirus (COVID-19) situation and the applicable guidance have changed by the date of the meeting. The Company will provide any status update on its website at www.newtrendlifestylegroup.com, but Shareholders should assume that they will not be permitted entry to the building at which the General Meeting is to take place, or the General Meeting itself.
The Company has received irrevocable undertakings from the following shareholders confirming their agreement to vote in favour of the Resolutions detailed below:
· Phang Song Hua in respect of 31,453,333 Ordinary Shares (representing approximately 13.98 per cent. of the Existing Ordinary Shares), to vote in favour of the Resolutions numbered 2, 3, 4, 5 and 6;
· Leow Lye Seng in respect of 50,000,000 Ordinary Shares (representing approximately 22.22 per cent. of the Existing Ordinary Shares) to vote in favour of all the Resolutions; and
· Zishange Capital Management Pte Ltd in respect of 50,000,000 Ordinary Shares (representing approximately 22.22 per cent. of the Existing Ordinary Shares) to vote in favour of all the Resolutions.
Phang Song Hua is interested in the Disposal so has not participated in the Board's consideration in relation to the Disposal and makes no recommendation in relation to Resolution 1. Gregory Collier and Ajay Rajpal having consulted with SPARK, the Company's Nominated Adviser, consider the terms of the Disposal to be fair and reasonable insofar as the Company's Shareholders are concerned and recommend Shareholders to vote in favour of Resolution 1.
The independent directors in respect of the Disposal have considered the alternatives to the Disposal and have concluded that out of the alternatives, the Company carrying out the Disposal and becoming a cash shell is most likely to represent the best value to the Shareholders in the long term.
The Directors consider that the Placing will promote the success of the Company for the benefit of its members as a whole. Accordingly, the Directors unanimously recommend Shareholders to vote in favour of Resolutions 4 and 5 at the General Meeting as Phang Song Hua intends to do in respect of his own beneficial holdings of 31,453,333 Ordinary Shares representing approximately 13.98 per cent. of the Existing Ordinary Shares.
All the Directors unanimously recommend Shareholders to vote in favour of Resolutions 2, 3, 4, 5 and 6.
~ ENDS ~