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Nippecraft told to make cash exit offer to shareholders

PAPER products maker Nippecraft has to make a cash exit offer to its shareholders, and has until May 9 to do so before trading of its shares ceases on the Singapore Exchange's main board.

In the meantime, it is still hoping to extend the timeline for its removal from the SGX's watch-list.

Detailing these in a filing on Tuesday morning, the homegrown company said that on April 10, it received a note from SGX saying that its earlier request to extend the time to exit SGX's watch-list has been denied.

SGX has given it more time to make a cash exit offer to shareholders. Hence, trading of the company's shares will continue until 5.05pm on May 9, and will remain suspended from 9am on May 11 until completion of the cash exit offer.

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Nippecraft was put on the watch-list three years ago on March 5, 2014. This means that it is expected to return to profitability or lift its market capitalisation above S$40 million.

Nippecraft still hopes to obtain an extension, said chief executive officer Connie Oi. "The board is discussing the decision with the SGX-ST with the aim of obtaining the extension, as, inter alia, the company would have been profitable for the financial year ended Dec 31, 2016, had the company not incurred various one-off expenses which amounted to approximately US$2.37 million for FY2016."

These expenses included redundancy payout, production wage cost of the retrenched employees and air freight costs to ensure that its products were delivered to customers due to outsourcing delays.

Based on its audited financial results for FY2016, had the company not incurred the one-off expenses, Nippecraft would have a pre-tax profit of US$318,000, it said.

Shares of Nippecraft last traded at 3.5 Singapore cents apiece last week.