ecoWise Holdings says its wholly-owned subsidiary, Sunrich Integrated, has entered into agreements for the disposal of its property in Sabah, Malaysia, according to a Nov 25 release.

 

The property, comprising a leasehold land with double storey detached office cum warehouse located at Lot 6 and Lot 7,   has purchase considerations of RM4.7 million ($1.4 million) and RM5.8 million ($1.8 million) respectively. 

 

The property contains a combined land area of approximately 36,313 sqf and built-up area of 30,784 sqf. The property is under 99-year leasehold expiring on Dec 31, 2074. 

 

According to the group, the proposed disposal is expected to strengthen the cash position, improve liquidity of ecoWise, and is part of the group&rsquo s efforts to monetise non-core assets in Malaysia. 

 

The proceeds of the proposed disposal is set to go towards the repayment of bank borrowings and general working capital requirements of the group. 

 

On a pro forma basis, had the disposal been completed on April 30, the group&rsquo s FY2024 net tangible assets (NTA) would have stood at $15.8 million, instead of $15.2 million. The group&rsquo s NTA per share would have stood at 1.67 cents, instead of 1.60 cents. 

 

Had the disposal been completed on May 1, 2023, the group&rsquo s loss for FY2024 would have stood at $656,000, instead of a loss of $1.3 million. The group&rsquo s loss per share would have stood at 0.07 cents, instead of 0.14 cents. 

 

STRIFE-HIT environmental-solutions provider ecoWise has reported S$7.11 million in total comprehensive loss for FY2021 based on its audited financial statements, almost twice the unaudited figure of S$3.81 million.

 

In a bourse filing on Sunday (May 15), ecoWise reported material variances between its audited and unaudited financial statements for the year ended Oct 31, 2021.

 

Among other things, the variances were due to potential legal claims from former employees, impairments, accrual of professional fees, bonuses, depreciation of additional reinstatement costs, and over-provision of income and deferred tax liabilities for its Malaysia subsidiaries.

 

These resulted in lower other gains and higher other losses.

 

Its independent auditor RSM Chio Lim issued a disclaimer of opinion in its report on the audited consolidated financial statement for FY2021. The disclaimer of opinion is based on factors such as service agreements entered by Chongqing ecoWise Investment Management, disclosures of related-party relationships, transactions and balances, unconsolidated entities, an internal audit under its notice of compliance, and accounting of long-outstanding payables.

 

The group&rsquo s plans in the immediate future include stabilising operations in Singapore and Malaysia, monetising its non-core assets in Singapore, Malaysia and China, as well as exploring opportunities to generate additional funds for working-capital purposes, either via loans from third parties and/or existing substantial shareholders.

 

The company said it will engage with external and internal auditors, as well as other relevant professionals, to determine the appropriate steps to address matters raised in the auditor&rsquo s report.

 

Executive director and deputy chief executive officer of ecoWise Holdings has been ousted, after over 90 per cent of the votes cast wanted him out, according to shareholders who requisitioned for the removal.

 

This came as the company' s extraordinary general meeting (EGM) convened on Thursday (Apr 14) to boot Cao Shixuan out with immediate effect and appoint Danny Oh Beng Teck, Gan Fong Jek and Tan Poh Chye Allan as new directors.

 

In its regulatory filing on Thursday, ecoWise announced that Cao had resigned with effect from Wednesday.

 

The statement from the company' s 8 shareholders, who own about 11.3 per cent stake collectively and had requisitioned for the EGM, said that some 92.9 per cent of the votes cast supported 4 resolutions concerning Cao' s ouster and the appointment of the 3 directors.

 

The directors, these shareholders stated, should work towards full compliance with the frontline market regulator' s notice of compliance and ultimately facilitate resumption of trading in the environmental solutions provider' s shares as soon as possible.

 

The company' s internal disputes came to the fore in June 2021 when chief executive Lee Thiam Seng changed the locks of its server rooms and suspended Cao and some staff members, prompting Cao to make a police report about the incident.

  The extraordinary general meeting (EGM) called for by eight shareholders of beleaguered ecoWise Holdings will take place on April 14 as planned, after the company said the three candidates who have been put forth by the shareholders to be voted in as directors are suitable.

 

These eight shareholders, who collectively own some 107 million ordinary shares of ecoWise, or a combined stake of 11.3 per cent, are convening the EGM to remove deputy chief executive Cao Shixuan from both his office as a director of the group and all his appointments with the company and its associated firms, as well as to appoint three new directors.

 

These three directors are Dr Danny Oh Beng Teck, Mr Gan Fong Jek and Mr Allan Tan Poh Chye.

 

In a filing late on April 8, ecoWise said its nominating committee and sponsor W Capital Markets have reviewed and assessed the suitability of the proposed directors, as well as the efficacy of the board as a whole upon their appointments.

 

The nominating committee and sponsor reviewed documents such as the resumes of the proposed new directors and their confirmation of independence. They have also commissioned a background check on the proposed new directors, and interviewed the trio to understand their professional background and experience.

 

Based on these steps, ecoWise' s nominating committee and sponsor concluded that the three proposed directors are " well-qualified, respected professionals in their respective fields of expertise" and deem them to have no conflicts of interest.

 

The three may be considered independent even though they have been recommended for appointment as directors by the relevant shareholders, said ecoWise.

 

These trio have also confirmed that they will ensure the smooth completion of the audit and internal audit of ecoWise' s first-half financial year 2021 financial results, as well as the satisfactory resolution of material findings from RSM Chio Lim LLP and Ernst & Young Advisory.

 

They have also said they will render support to the Singapore Exchange Regulation (SGX RegCo), W Capital Markets, RSM and EY, including responding to requests for information, interviews and visits to facilitate the first-half FY2021 audit and internal audit.

 

The appointment of the three proposed directors will result in an increase in ecoWise' s number of directors. After their appointments, the board will have six independent non-executive directors.

 

However, the company said this could be a " temporary situation" as the nominating committee may deliberate and advise the board on the optimal board size upon the resolution of issues in the notice of compliance that was issued by SGX RegCo in June last year.

 

The company said its board will continue to have various committees - the audit committee, nominating committee and remuneration committee - with clear written terms of reference.

 

Mr Gan, who is the only proposed director that does not have prior experience as a director of companies listed on SGX, has completed the training in the roles and responsibilities of a director of a listed company.

 

" In view of the above and the strong element of independence on the board, the NC (nominating committee) and the sponsor believe that the group will benefit from the diverse experience of the members of the board and appointment of the proposed new directors will not adversely affect the efficacy of the board," said ecoWise.