Hot stock: Spackman up 25% following independent review

SHARES of Spackman Entertainment Group saw heavy trading on Friday (Jun 17) a day after the regulatory arm of the Singapore Exchange (SGX RegCo) issued a statement on Spackman, addressing a Thursday report by Deloitte & Touche Financial Advisory Services. 

As at 9.02 am, Spackman shares opened 25 per cent or S$0.001 higher at S$0.005.

The counter maintained its share price at this level after some 20.5 million securities changed hands as at the midday trading break, making the counter 1 of the top 10 most actively traded by volume on the Singapore bourse. 

No married deals were recorded in early trade, according to ShareInvestor data. 

The statement issued by SGX RegCo on Thursday addressed the report by Deloitte & Touche Financial Advisory Services released as well as a notice of compliance issed to the company previously on Sep 3, 2020. 

SGX RegCo noted between March 2017 and August 2018, Spackman had entered into 5 share sale and purchase agreements with various vendors to purchase shares in Spackman Media Group Limited (SMGL) at US$3 each, increasing the company's shareholding in SMGL to 43.88 per cent from 24.53 per cent.

In its report, Deloitte was unable to conclude if the acquisition price of US$3 per share was reasonable due to a lack of a proper valuation being conducted on SMGL, SGX RegCo added.

Noting that the board had relied on the representations from the company's management and past events and reports to approve certain past acquisitions, Deloitte highlighted that the board should have commissioned a valuation of SMGL shares to safeguard the interest of the company's shareholders.  

Deloitte concluded there were potential breaches of Catalist listing rules, including the company's failure to maintain a "robust and effective system of internal controls to address financial, operational and compliance risks pertaining to the past acquisitions". 

SGX RegCo said it will look into the potential rule breaches and where relevant, refer the Deloitte report to the relevant authorities for their further investigation into the past acquisitions mentioned.

Shares of Spackman closed up 25 per cent or S$0.001 to S$0.005 on Friday.



BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to