Intraco to invest in digital asset platform

MAINBOARD-LISTED trading company Intraco I06 announced on Monday (Dec 13) that it has entered into a binding heads of agreement to invest in digital asset platform MHC Digital Co (MHC Singapore).

MHC Singapore, to be incorporated in Singapore by Australian entrepreneurs Mark Carnegie and Sergei Sergienko with equal shareholdings, will take over the relevant businesses and assets Australian digital asset platform MHC Digital Group.

Under the binding heads of agreement with Carnegie and Sergienko, Intraco will pay S$10 million in cash and issue 100 million new shares in the company at an issue price of S$0.50 per share for a 51 per cent interest in MHC Singapore. Intraco noted that the issuance of the consideration shares at S$0.50 per share is a significant premium to the company's current trading share price.

Separately, Wong Fong Fui or FF Wong who is chairman and group chief executive officer of Boustead Singapore - will be extending a S$10 million loan to MHC Singapore for its business purposes.

Subject to shareholders' approval, Intraco will also issue 40 million warrants at an exercise price of S$0.50 to Wong for introducing MHC Digital Group and the deal to the company.

MHC Digital Group was founded by Carnegie and its primary businesses include fund management of a portfolio of digital assets as well as trading of digital assets.

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The group intends to expand its fund management offerings and incorporate new trading strategies in the development of traditional OTC execution and market making services.

It also plans to provide corporate finance advisory services focused on leveraging an expanded balance sheet to provide a gateway to institutional investors to deploy capital into traditional financial products with exposure to the metaverse and digital asset ecosystem.

Chairman of Intraco, Mak Lye Mun, said: "This is a truly exciting opportunity for Intraco and one that is potentially transformative for the company. The investment into MHC Digital Group will allow the company to gain access to the fast growing digital asset industry. In addition, it will create new revenue streams and enhance our shareholders' value. We are optimistic that MHC Singapore, as part of Intraco, a Singapore listed company, will be able to accelerate its platform growth more rapidly within the region and beyond."

Said Carnegie: "Singapore is one of the most advanced countries in the world when it comes to thinking through how they want to regulate Web 3.0. The issues are complex and challenging but the Singapore authorities understand the importance of addressing these issues as the space evolves and digital asset adoption accelerates."

Intraco, Carnegie and Sergienko have agreed to sign a definitive agreement in the next 2 months following the entry into this heads of agreement.

The completion of the investment under the agreement is subject to various conditions including the successful completion of the restructuring of the relevant businesses and assets in the MHC Digital Group to be held by MHC Singapore, procurement of the requisite licences and regulatory approvals, satisfactory due diligence and financial performance and shareholders' approval at an extraordinary general meeting to be held by the company.

A circular will be sent to shareholders and further details will be announced on SGXNet, when available.

Shares of Intraco ended Monday at S$0.445, up S$0.205 or 85.4 per cent.