SGX RegCo orders Nutryfarm International to appoint independent reviewer to conduct investigation

SINGAPORE Exchange Regulation (SGX RegCo) has ordered Nutryfarm International, through a notice of compliance, to appoint a suitable independent reviewer to conduct an investigation over two key issues.

The first is regarding a significant refundable deposit of HK$91.4 million (S$15.8 million) made in relation to the proposed acquisition of tech company First Linkage, and the second is the significant advances of 26.81 million yuan (S$5.58 million) made to Chengdu Meili Tianyuan Agriculture Co (MLTY), the associate of two of NutryFarm (Chengdu) Biomedicine's (NFC) customers.

The reviewer is expected to investigate the facts and circumstances surrounding the proposed acquisition of First Linkage, including an assessment into the payment of the refundable deposit by LottVision Internet Management (Nutryfarm's wholly owned subsidiary) amounting to HK$91.4 million to Wang Xiaoxin, as well as the recovery of the refundable deposit from Mr Wang. Mr Wang is the sole shareholder of First Linkage.

In addition, the reviewer also needs to examine the facts and circumstances surrounding the proposed acquisition of Xinjiang Zhongtong Internet Science and Technology Development (XJZT) and the facts and circumstances surrounding the advance payments of 26.81 million yuan to MLTY.

This comes as the company had updated that MLTY did not repay the advances since late 2019.

The independent reviewer to be appointed and the scope of the independent review are subject to SGX RegCo's approval, and he or she should report its findings directly and solely to SGX RegCo.

Nutryfarm's shares closed at 35 Singapore cents on Wednesday, down 2 cents or 5.41 per cent.