The announcement comes after the cinema chain received a S$3.4 million payment demand from the landlord of its shuttered Jem outlet

 

[SINGAPORE] Media company mm2 Asia, which operates the Cathay Cineplexes cinema chain, has proposed the placement of 1,875 million shares at a minimum of S$0.008 per share, to raise funds for debt repayment and working capital.  

 

If all the shares are subscribed to at the minimum price, mm2 will raise S$14 million in net proceeds. Of this, it will use S$7.5 million to repay debts and liabilities, with the remainder to be used as general working capital.

 

The proposed placement is &ldquo part of the company&rsquo s ongoing efforts to strengthen its financial position&rdquo and will also improve its cash flow, mm2 said in a bourse filing on Friday (Jul 4). 

 

The announcement comes after Cathay received a S$3.4 million payment demand from the landlord of its shuttered Jem outlet.

 

The placement price will be set at S$0.008 or the volume-weighted average price (VWAP) per share over the 30 days preceding the date of approval from shareholders, if the latter is higher.

 

The S$0.008 minimum price is at 14.3 per cent premium to the VWAP of S$0.007 of the trades on Friday (Jul 4). Mm2 shares had ended the day at the same price, down by S$0.001 or 12.5 per cent.

 

Cathay Cineplexes gets S$3.4 million payment demand from landlord of shuttered Jem outlet

If successfully placed, the 1,875 million shares will represent about 22.3 per cent of mm2&rsquo s enlarged share capital. 

 

The company will next seek shareholders&rsquo approval for the allotment and issuance of the placement shares at an extraordinary general meeting that is to be convened. The placement agent is UOB Kay Hian. 

The proceeds from the proposed disposal will be used to repay the group&rsquo s outstanding liabilities

 

[SINGAPORE] Media company mm2 Asia : 1B0 0% on Wednesday (May 28) entered into a sale and purchase agreement with private equity fund Hildrics Asia Growth Fund VCC to dispose of 21.02 per cent of its stake in subsidiary Vividthree Holdings for S$1.7 million.

 

Mainboard-listed mm2 Asia currently holds about 29.9 per cent of the total issued and paid-up share capital of Vividthree.

 

Following the proposed disposal, the company will hold about 8.9 per cent of Vividthree&rsquo s total issued and paid-up share capital, and Vividthree will cease to be an associated company of the group.

 

Vividthree was established in 2006 and is listed on the Catalist board of the Singapore Exchange (SGX). It is principally involved in the business of digital content production specialising in virtual reality, visual effects and computer-generated imagery.

 

The buyer Hildrics Asia Growth Fund VCC is a private equity fund that provides growth capital to mid-tier South-east Asian enterprises with established track records and growth potential.

 

It is managed by Hildrics Capital, a Singapore-based fund management company specialising in originating proprietary deals across all industries in Singapore and South-east Asia.

 

The firm focuses on long-term capital appreciation through equity and equity-related investments and has a long-term interest aligned with the management of its portfolio companies, said mm2 Asia in a bourse filing.

 

It added that the proposed disposal &ldquo is in the best interests&rdquo of the group, as this gives it an opportunity to realise the value of the sale shares, enhance the group&rsquo s liquidity and improve its overall financial position and flexibility.

 

The proceeds from the proposed disposal will be used to repay the group&rsquo s outstanding liabilities.

 

Based on the latest announced unaudited consolidated financial statements of mm2 Asia for the financial period ended Sep 30, 2024, the book value of the sale shares is an estimated S$2.05 million.

 

Meanwhile, the net tangible asset value of the sale shares, excluding non-controlling interests, is an estimated S$1.9 million. The net loss attributable to the sale shares is about S$176,812.

 

An independent valuation on the sale shares was not conducted, said mm2 Asia.

 

Based on the volume-weighted average price of Vividthree&rsquo s S$0.0197 per share for trades transacted on the Catalist of the SGX on May 28, which was the last full market day preceding the date of the sales and purchase agreement, the open market value of the sale shares is approximately S$1.9 million.

 

The consideration for the proposed disposal is S$0.01734 per sale share, which amounts to an estimated S$1.7 million. Hildrics Asia Growth Fund VCC will pay this in cash.

 

Based on the book value of the sale shares, there is a deficit of approximately S$357,068.06 of the consideration, mm2 Asia noted.

 

Based on mm2 Asia&rsquo s financial statements for the period ended Sep 30, the loss on disposal of the sale shares amounts to approximately S$2.8 million.

 

The proposed disposal is expected to be completed on May 30, 2025, upon fulfilment of all conditions.

 

Assuming the proposed disposal was completed on Mar 31, 2024, the group&rsquo s net tangible assets per share would be 0.016 cent, compared with 0.017 cent before the disposal.

 

Meanwhile, assuming the proposal disposal was completed on Apr 1, 2024, its loss per share would be 0.003 cent, against a loss of 0.002 cent before the disposal.