Investor offers S$48m convertible loan to TT International instead of assets buy

Singapore

SEYCHELLES-INCORPORATED firm Celestial Palace will be investing in TT International, as opposed to buying up certain of its assets.

The purchaser turned investor will grant the mainboard-listed company a convertible loan of S$48 million in order to provide alternative funding to help implement a new restructuring scheme, TT International said in a statement on Thursday.

It may also at its option convert the full amount of the drawndown convertible loan of up to S$48 million into shares at a conversion price of S$0.01 apiece, conditional to shareholders' and regulatory approval.

Up to S$45 million of that amount will be used to fund the implementation of the new scheme of arrangement and terminate agreements struck in the previous proposed disposal, purchaser loan and bridging loan.

"The implementation of the new scheme would allow the company to resolve presently unsustainable liabilities and the right-sizing of its balance sheet which will allow the company to pursue post-restructuring business directions as a going concern," said TT International.

It added that following discussions with the investor, both parties have agreed to terminate the proposed disposal, the management services agreement, the purchaser loan of S$7.5 million and the bridging loan of up to S$3 million.

Neither TT International nor the investor will have any claim of any nature against each other in connection with the agreements.

On April 18, TT International applied to the High Court for an extension of the existing moratorium, which expired on April 30, 2019, until July 31, 2019 instead.

It also applied for an extension, till the same date, of the long stop date for the implementation of its scheme of arrangement.

The scheme involves the sale of shares in various subsidiaries to Celestial Palace, that invest in consumer electronics products, furniture as well as mid to high-end luxury goods.

The High Court had approved the new scheme in March subject to amendments and conditions.

The scheme, announced on July 31 last year, was contingent upon TT International selling in full 10 wholly owned subsidiaries of the group involved in furniture and consumer electronics sales, for a sum of S$48 million.

Its restructuring scheme excludes the company's 51 per cent subsidiary Big Box Singapore, which owns the Big Box warehouse mall in Jurong East. The unit's voluntary liquidation was initiated in September 2018.

Trading in the company's shares has been voluntarily suspended since Aug 4, 2017.