CATALIST-LISTED Totm Technologies 42F : 42F 0% plans to divest 2 subsidiaries to an associate of its chairman as it pivots to the biometrics solutions business, the board disclosed in a bourse filing on Friday (Dec 10).

Totm, which used to trade as Yinda Infocomm, plans to exit the telecom business with the package sale of loss-making Yinda Technology Singapore and Yinda Technology (Thailand) for a nominal S$1,001. The board said that the units were independently valued at a nil indicative market value, on a preliminary basis, with the price reached after arm's length negotiations.

Conditions for the deal include Totm novating to the buyer some S$3.2 million that is outstanding under shareholder loans, and waiving about S$1 million owed. The board estimated that the sale would yield a net gain of about S$415,000 as a result.

Independent shareholders must approve the deal at an extraordinary general meeting, since Totm chairman Song Xingyi holds a majority stake in the controlling shareholder of the buyer.

Shanghai Yinda Group, which indirectly owns 97.1 per cent of the buyer, is 51.5 per cent-owned by Song. Son Wang Hua, holds 33.7 per cent of Shanghai Yinda Group; her husband, Wang Zhijun, owns 13.9 per cent. Another 1 per cent is owned by Totm executive director Shao Lifang.

The Totm board said that the sale would boost the group's business diversification into identity management biometric technology solutions, which the company has dealt in since Apr 2021, and would also let it exit the loss-making telecommunication business segment.

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On a pro forma basis, Totm's loss per share would have narrowed from 1 Singapore cent to 0.62 cent, had the deal been done on Jun 1, 2020, while net tangible assets would have risen from 1.1 cents to 1.15 cents, had the deal gone through on May 31, 2021, said the board.

Totm shares closed on Friday at S$0.195, up by 0.7 cent or 3.72 per cent, before the announcement.