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NGSC, facing delisting, inks supply-chain management JV deal
MAINBOARD-LISTED NGSC, which is facing a mandatory delisting by the bourse operator, inked a pact on Tuesday to deal in telecom-related supply-chain management services.
The joint-venture agreement will see NGSC, formerly known as Next-Generation Satellite Communications, taking a 51 per cent stake in the tie-up with businessman Charlie In.
But the joint venture will depend on whether NGSC can secure from the Singapore Exchange (SGX) a one-year extension or moratorium to its potential delisting, the board disclosed.
The SGX had told the company on Dec 3 that it must come up with an exit offer to shareholders and suspend trading from Jan 3, 2020, as it has not met the criteria for removal from the bourse watch-list for companies with pre-tax losses or low average daily market cap.
NGSC, which offers satellite-based services for industry, reiterated on Tuesday that it intends to appeal against the planned delisting "and will make further announcement of any material development on this as and when appropriate".
The latest joint-venture agreement, which is not expected to have a material impact on the group's consolidated net tangible assets and consolidated earnings per share for this financial year, will become effective when the condition for a stay of the delisting is met.
Under the terms of the deal, Dr In, the joint-venture partner, must also "use his best endeavours to promote and develop" the supply-chain management services business and turn an annual audited post-tax profit of at least S$10 million for the first two years.
Dr In was described as having "extensive experience in trading, business management, capital sourcing, consulting, marketing, mergers and acquisitions".
He previously made the news in 2015 when a special audit of Catalist-listed real estate firm Cedar Strategic Holdings found that Dr In, the former executive chairman, had allegedly made unauthorised payments to himself. Cedar Strategic later reached settlements with Dr In in 2016 over its claims.
Separately, NGSC also made headlines in June this year when it filed a police report over suspected unauthorised payments of about S$1.1 million made by two unnamed former directors.
The board most recently said on Dec 5 that it has issued a writ of summons and statement of claim for about S$1.03 million, as well as interest and costs, against two former directors.
The NGSC board noted in its latest filing that shareholders should exercise caution when dealing in the company's shares "as there is no certainty or assurance as at the date of this announcement as to the outcome of the appeal" on the planned delisting of the company.
NGSC shares closed flat at 0.1 Singapore cent on Tuesday before the announcement.