Oceanus sets up new unit in China; will work on watch list exit

Singapore

OCEANUS Group on Monday announced its incorporation of a new subsidiary in China to "trade in global food supply chain management and strengthen food security within the region".

According to the group's regulatory bourse filing, Sino Food Group was established with paid-up capital of S$1,000 divided in 1,000 shares to be majority-held by Oceanus' other subsidiary, Season Global Trading (SGT).

The mainboard-listed seafood supplier said Sino Food Group was appointed as an approved distributor of China Resources Wufeng, a food enterprise group under state-owned enterprise China Resources.

It will also receive financing support from a consortium of Chinese state-owned enterprises including Shenzhen Rural Commercial Bank and Guandong Light Industry.

Peter Koh, chief executive of Oceanus, said the incorporation of Sino Food Group is expected to accelerate the group's progress and expand its geographical footprint in the food distribution industry.

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"China remains an important target market in Asia, and we are delighted that we are beginning to see the fruits of our labour in this market… We are confident that Sino Food Group will bolster the global food supply chain and supplement food security in Asia," commented Mr Koh.

In a separate filing on the same day, the group announced that the Singapore Exchange (SGX) Regulation was "in close communication" with Oceanus on its application to exit the SGX watch list.

Its proposal to exit the watch list includes the contribution of Oceanus' various key revenue drivers, particularly its distribution segment that saw "significant growth" for the financial year ended Dec 2020 following the establishment of SGT, said the group.

"In collaboration with (the group's) joint venture partner (Season Hong International Trading), SGT is expected to handle increased trading volumes in the upcoming year as it continues to build its reputation amongst its customers as a Singapore-based business. This is part of the company's longer-term strategy to establish its global supply chain capabilities and supplement its three other key business pillars," noted Oceanus in its update.

Oceanus said it is "not aware of any precedent in the history of SGX's watch list whereby a company having faced a similar situation for such an extended period, successfully achieves a complete turnaround through concerted restructuring efforts, and submits an exit application".

The group nonetheless said it will "continue to work tirelessly with SGX in this process" - and provide an update to shareholders on the result of the exit application in due course.

Shares of Oceanus ended S$0.036 or 2.9 per cent higher on Monday, after both announcements were made.