Mercurius completes JV ahead of Jan 31 deadline

CATALIST-LISTED Mercurius Capital Investment on Thursday night announced the completion of a joint venture that will help it to retain its listing status, and requested the lifting of an earlier-called trading halt.

Mercurius said its earlier-announced joint venture with Thai developers Apex Development Public Co and Grand Bay Hotel was completed on Jan 7, pursuant to an addendum to revise the purchase price of the sales shares and the terms of payment. Mercurius had earlier been given until Jan 31 to complete the joint venture and demonstrate its business viability by investing in Grand Bay, failing which it would be deemed a cash company.

Under the original joint-venture terms, the total purchase price comprised a fixed purchase price of 335 million baht (S$14.95 million) plus a variable price of half of the joint venture's construction and development costs, less 50 million baht.

Pursuant to the addendum, in view of a 200 million baht loan jointly obtained by Apex and Grand Bay, it was agreed to offset 100 million baht as partial satisfaction of the fixed purchase price.

The parties have further agreed that the loan shall be refinanced, and Mercurius is working with Apex to arrange for such refinancing for Grand Bay's operations. Mercurius said it will provide any material updates and make the necessary announcements in accordance with the Catalist rules.

Mercurius and Apex also agreed to reduce the fixed purchase price, on a willing buyer willing seller basis, to 304 million baht. The balance of this revised fixed purchase price, taking into account the instalments paid to date and the 100 million baht offset, is 37 million baht.

The payment of this balance was made to Apex on Jan 7, and the remaining 60 per cent of sale shares was transferred to Mercurius. Mercurius thus owns 100 per cent of the sales shares, equivalent to half the total issued share capital of Grand Bay.

Mercurius will also make payment within 14 days upon receipt of notice from Apex on the calculation of the variable purchase price, after reviewing and approving the submitted evidence.

The funds used in the Jan 7 payment were from proceeds raised in Mercurius's recent convertible loans dated Dec 15, Dec 23 and Jan 3. Mercurius thus gave an update on the use of net proceeds from the respective convertible loans. On Jan 7, S$98,000 of the Dec 15 loan, the full S$988,000 of the Dec 23 loan, and S$596,000 of the Jan 3 loan was used.

Mercurius shares last traded at 4.8 Singapore cents before the Jan 8 trading halt.