SGX RegCo urges caution when dealing in Vividthree's shares

FRONTLINE market regulator Singapore Exchange Regulation (SGX RegCo) is urging investors to exercise caution when dealing in the shares of Vividthree Holdings.

According to SGX RegCo, a review of the trades in Vividthree shares between Sept 9, 2019 and Feb 19, 2020 showed that a small group of accounts was responsible for over 90 per cent of the traded volume.

The individuals behind these accounts appear to be connected to each other, SGX RegCo said in a statement on Thursday.

In addition, these accounts appear to have traded among themselves in what is known as "cross trades" during the period reviewed. Their cross trades accounted for 71 per cent of on-market traded volume, SGX RegCo said.

"Out of 111 active trading days, these accounts engaged in cross-trading activity on 94 days," it noted.

SGX RegCo also said that on Feb 12, Vividthree announced a placement of up to 15,880,000 shares at a price of at least 12.6 Singapore cents each, which is at a premium of 27.3 per cent to the volume-weighted average price of 9.9 Singapore cents on the date of the placement agreement.

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The placement will be on a best-effort basis by the placement agent and subject to Vividthree and the placement agent entering into a pricing supplement by Apr 30, 2020.

The announcement of the placement followed a decline in Vividthree's share price since mid-January 2020. The shares closed at 9.5 Singapore cents on Feb 19, 2020. Throughout this period, the volume of cross trades between these accounts progressively increased, SGX RegCo said. 

It added that it is working closely with the authorities on the matter.

Vividthree shares rose 0.3 cent or 3.16 per cent to S$0.098 on Thursday, with 77,700 shares changing hands.

The company is a visual effects studio that was listed on the Catalist board in September 2019. It is a spin-off from Mainboard-listed local movie producer mm2 Asia.