Cosmosteel&rsquo s CEO and executive director, Jack Ong Tong Hai, has resigned from his position due to &ldquo personal reasons&rdquo .

 

Ong, who has been with the company since 1998, was appointed to his current position in July 2019. His last day will be on Dec 31.

 

Ong&rsquo s departure comes after 3HA Capital&rsquo s revised offer was declared unconditional in all respects on July 7. 3HA Capital had received valid acceptances of 50.23% of the total number of shares on the day of the announcement.

 

On May 15, 3HA Capital offered 20 cents per share for the Mainboard-listed piping steel supplier. 3HA Capital comprises a group of investors including a wholly-owned subsidiary of Cosmosteel Holdings&rsquo controlling shareholder Hanwa Co.

 

On May 21, Ong increased his stake in the company by buying shares from the open market. Ong had bought 5.55 million shares for over $1.2 million from May 20, bringing his total stake to 43.4 million shares or 16.62% up from 14.5% previously.

 

Per Cosmosteel&rsquo s annual report as at Dec 11, 2024, Ong&rsquo s brother, Ong Tong Yang, holds another 7.63% of the shares.

 

On May 22, CEO Ong bought another 500,000 shares, bringing his total stake to 43.9 million shares equivalent to 16.81%, up from 16.62% before.

 

3HA Capital upped its offer price to 25 cents after the independent financial advisor (IFA) deemed the offer &ldquo not fair&rdquo on June 23.

 

Ong had tendered all 47.44 million of his shares in acceptance of the cash offer on July 8. His brother, Ong Tong Yang, also tendered all 19.95 million shares to accept the offer on the same day.

 

According to Cosmosteel&rsquo s filing dated July 11, the company will make an announcement should a new CEO and executive director be &ldquo confirmed and finalised&rdquo .

On Jun 13, CosmoSteel executive director and CEO Jack Ong acquired two million shares at an average price of S$0.22 each, boosting his direct interest from 17.39 per cent to 18.15 per cent. 

 

On May 15, Evolve Capital Advisory, on behalf of 3HA Capital, announced a voluntary conditional cash offer for all issued and paid-up ordinary shares of CosmoSteel at S$0.20 apiece. The offer has drawn scrutiny from significant shareholders the Ong family, who have requested clarifications. Prior to the development, CosmoSteel&rsquo s CEO had also raised his direct interest from 14.5 per cent.

 

SunMoon Food Company 

Between Jun 13 and 18, SunMoon Food Company executive director and CEO Zhang Ye acquired 3,099,100 shares at S$0.16 apiece. This increased his total interest from 51.77 per cent to 52.12 per cent.

 

He has been gradually increasing his total interest from 51.57 per cent since May 27, when the group reported its FY2024/2025 (ended Mar 31) results. He was appointed CEO and executive director in December 2018.

 

The serial entrepreneur also founded Yiguo &ndash China&rsquo s first fresh food e-commerce platform &ndash and Enmore Group, which is now a leading player in China&rsquo s bulk chemical services sector.

 

For FY2024/2025, SunMoon Food Company reported revenue of S$33.83 million, up from S$27.06 million the previous year. The growth was driven by stronger sales of fruits, aquatic foods, and non-hazardous chemical products. The group generated 93 per cent of its revenue for the period from China, with the remainder coming from Asean.

 

Its gross profit for FY2024/2025 remained steady at S$821,000, though the margin declined to 2.43 per cent from 3.03 per cent in FY2023/2024, due mainly to the clearance of slow-moving inventory sold at minimal or negative margins.

 

The company said it is working to enhance profitability by expanding its non-hazardous chemical segment through strategic partnerships. It also remains focused on growing cross-border trade &ndash exporting food products from China to South-east Asia, and importing basa fish (a freshwater fish native to South-east Asia) into China.

Cosmosteel&rsquo s shareholders should &ldquo accept&rdquo the offer made by 3HA Capital, says the independent financial adviser (IFA), Asian Corporate Advisors in a circular released in the evening of June 19. The recommendation comes after the IFA deemed the 20-cent offer to be &ldquo not fair&rdquo but &ldquo reasonable&rdquo .

 

3HA Capital is made up of a group of investors including a wholly-owned subsidiary of Cosmosteel&rsquo s controlling shareholder, Hanwa Co, IHH Group, Bursa-listed AYS Ventures Bhd and Thor Capital. The 20-cent offer was announced on May 15.

 

Offer is &lsquo not fair&rsquo

 

The offer is &ldquo not fair&rdquo due to several reasons.

 

First, Cosmosteel is on a &ldquo recovery track&rdquo with the company posting a net profit of $2.3 million for the 1HFY2025 ended March compared to the losses it registered in the same period the year before. Cosmosteel also noted, in its 1HFY2025 statement, that it expects to see better revenue in the FY2025.

 

The company&rsquo s higher borrowings for six months ended March 31 was mainly to fund its revenue growth, the IFA points out in its letter to shareholders.

 

Furthermore, Cosmosteel&rsquo s financial position remains &ldquo strong and healthy&rdquo with its net current position improving to $62.6 million as at March 31, from $60.2 million as at Sept 30, 2024. Cosmosteel&rsquo s equity base also expanded to $76.6 million as at March 31 from $74.3 million as at Sept 30, 2024, due to the plough back of earnings.

 

Next, 3HA Capital&rsquo s offer price of 20 cents represents a discount of about 31.8%, 46.8% and 47.8% from Cosmosteel&rsquo s net asset value (NAV) and/or net tangible assets (NTA), revalued net asset value (RNAV) and/or revalued net tangible assets (RNTA) and adjusted RNAV and/or adjusted RNTA per share respectively.

 

As at March 31, Cosmosteel&rsquo s NAV per share stood at 29.31 cents while its RNAV per share was calculated to be 37.6 cents after taking into account the market value and/or the fair value of the company&rsquo s appraised assets.

 

See also: Privatisation offer for Ossia International ' not fair' but ' reasonable'

 

Third, the offer price implies an &ldquo unfavourable comparison&rdquo of Cosmosteel&rsquo s valuation in terms of P/NAV against both the median and simple average for the selected non-privatisation transactions as well as the selected successful privatisations. The transactions were selected based on the offeror&rsquo s stake and its concert parties, which is lower compared to the other transactions at the beginning for each of these transactions.

 

The selected non-privatisation transactions and successful privatisations refer to selected recently completed mandatory and/or voluntary general offers for Singapore Exchange(SGX)-listed companies announced since Jan 1, 2022, to the latest practicable date, which is June 5.

 

Some of the names mentioned include Keong Hong Holdings, Procurri Corporation, No Signboard Holdings, Nera Telecommunicationsand HG Metal Manufacturing.

 

Fourth, the offer came up unfavourably compared to the takeovers of fellow steel companies such as HG Metal, Sin Ghee Huat Corporation and Hupsteel Limited. Cosmosteel&rsquo s offer came up to be lower and less favourable in terms of its P/RNAV and P/revenue, opines the IFA.

 

Fifth, the IFA notes that 3HA Capital&rsquo s offer is lower than the range of Cosmosteel&rsquo s estimated values per share and adds that there is no indication that 3HA Capital&rsquo s offer price is final.

 

But offer is &lsquo reasonable&rsquo

 

However, the offer was deemed to be &ldquo reasonable&rdquo given that the offer price had a substantial premium of about 48.1% over the last-transacted price for Cosmosteel&rsquo s shares on the last trading day before the offer was announced.

 

The offer price also implied a premium of 57.5%, 61.3%, 70.9%, 75.4%, and 72.4% over the volume weighted average price (VWAP) for the shares for the one-, three-, six-, 12- and 24-month periods prior to the last-trading day.

 

Furthermore, the offer price implies a premium of approximately 48.1% over the highest transacted prices for the Shares for the 24 months before the last trading day.

 

That said, the IFA notes that the historical premiums may have been affected by Cosmosteel&rsquo s Watch-list status. The company was placed on SGX&rsquo s watch-list since June 5, 2018, as it recorded pre-tax losses for its three most recently completed financial years and had an average daily market capitalisation of less than $40 million. At the time, Cosmosteel&rsquo s latest six-month average daily market capitalisation came to $36.3 million.

 

As such, the offer compares favourably among the selected non-privatisation and privatisation offers made previously as the implied premiums were &ldquo within the range&rdquo and &ldquo more favourable&rdquo than the median and the simple average premiums.

 

The IFA also pointed out that Cosmosteel was suffering from low liquidity in terms of average daily trading volume and frequency of trading before the offer announcement and that the offer was a &ldquo generally fair comparison&rdquo against the valuation of selected comparable companies including SGX listcos Annaik Limited, Asia Enterprise Holdings, BRC Asia, HG Metal and Union Steel Holdings.

 

The valuation does not account for the values of the appraised assets, with and without the proposed building expansion for Cosmosteel&rsquo s Senai property.

 

In addition, no other third party has made a firm offer for Cosmosteel&rsquo s shares and the company has not carried out other fund raising exercises since it listed on the Mainboard, except for a private placement conducted on Sept 17, 2009 and a share subscription by Hanwa on Dec 1, 2014.

 

Cosmosteel also had not declared dividends for the FY2024 and 1HFY2025, although the company explained, in its annual report for the FY2024, that its dividend policy seeks to &ldquo maintain a balance between meeting shareholders' expectations and prudent capital management with a sustainable dividend policy&rdquo .

 

Finally, IFA notes that the company has not been able to exit from SGX&rsquo s watch-list since June 2018. Even though Cosmosteel was not asked to delist on June 4, following the interim arrangement under the Singapore Exchange Regulation&rsquo s (SGX RegCo) consultation paper on removing the watch-list, Cosmosteel may be directed to delist after the conclusion of the public consultation.

 

Accept the offer, but sell shares in open market if opportunities arise

 

Even though the IFA recommended Cosmosteel&rsquo s shareholders to &ldquo accept&rdquo the offer, it is also recommending shareholders to sell the offer shares in the open market if Cosmosteel&rsquo s shares trade above the offer price of 20 cents.

 

The IFA adds that the transacted prices for Cosmosteel&rsquo s shares after the offer was announced, have &ldquo always been higher&rdquo than the offer price, even if it was caused by transactions made by a &ldquo certain director&rdquo of the company. Since the offer was announced, Cosmosteel&rsquo s CEO Jack Ong Tong Hai has been increasing his stake in the company by buying shares in the open market.

 

The offer price also represents a discount of about 11.1% over the last transacted price of 22.5 cents per share as at the latest practicable date being June 5.

Between Jun 6 and 11, CosmoSteel executive director and CEO Jack Ong acquired a million shares at an average price of S$0.220 apiece, increasing his direct interest from 17 to 17.39 per cent.

 

On May 15, Evolve Capital Advisory, on behalf of 3HA Capital, announced a voluntary conditional cash offer for all issued and paid-up ordinary shares of CosmoSteel at S$0.20 apiece. The offer is conditional on the offeror having received more than 50 per cent of the total number of issued shares (excluding shares held in treasury) as at the close of the offer under the minimum acceptance condition.

 

Nine Yards Chambers subsequently sent a letter to 3HA Capital on behalf of the Ong family, raising concerns about the voluntary cash offer for CosmoSteel and requesting clarifications that could influence shareholder decisions, given the Ong family&rsquo s stake and potential impact on the offer&rsquo s outcome.

 

Jack Ong, his brother Andy and their father Ong Chin Sum collectively owned 24.45 per cent of the company as at Dec 11, 2024. Filings show that Jack Ong has since increased his interest by 2.89 per cent.

The opposition from Cosmosteel CEO Ong Tong Hai comes amid more active shareholder efforts to secure better deals in such situations.

 

SINGAPORE &ndash The chief executive of CosmoSteel Holdings has spoken out against an offer to acquire all the shares of the company, amid more active efforts by shareholders to ensure they secure a fair deal in such situations.

 

Mr Ong Tong Hai, together with his brother Ong Tong Yang and their father Ong Chin Sum, told The Straits Times on May 30 that they are &ldquo deeply concerned&rdquo over the 20 cents per share voluntary conditional cash offer by 3HA Capital on May 15.

 

The three are long-term shareholders of CosmoSteel Holdings with a combined 26 per cent stake.

 

The offer is conditional on 3HA Capital holding over 50 per cent of CosmoSteel&rsquo s issued shares by the closing date of the offer, which will be announced in an offer document to be dispatched no later than June 5. An independent financial adviser (IFA) will be appointed in due course.

 

&ldquo We believe the offer does not represent fair value for shareholders and is made under potentially misleading premises,&rdquo the Ongs said in a statement to ST.

 

&ldquo We urge shareholders to carefully consider and evaluate the offer and stand with us in protecting the long-term interests of all shareholders.&rdquo

 

The Ongs noted that 3HA Capital had highlighted the risk of CosmoSteel being suspended from trading or delisted for being on the SGX watch list since June 2018 as one of the reasons shareholders may prefer a cash exit.

 

However, the offer price does not account for the proposed abolishing of the watch list by Singapore Exchange Regulation and its confirmation that no listed company would be forced to delist or suspend trading pending the review, they said.

 

The bourse regulator on May 15 said it is consulting the public on scrapping the watch list for loss-making mainboard companies as part of efforts to reduce regulatory friction and encourage price discovery.

 

The Ongs added that &ldquo the offer price grossly undervalues CosmoSteel&rsquo s recovery trajectory, assets, and growth potential&rdquo .

 

While 3HA Capital&rsquo s offer price of 20 cents is 48.1 per cent higher than CosmoSteel&rsquo s share price of 13.5 cents on May 14 before the offer was announced, it is still a discount to the company&rsquo s net asset value per share of 29.3 cents as at March 31.

 

It also does not account for the company turning a profit for the first half of the 2025 financial year, compared with losses in the previous year, the Ongs said.

 

In fact, Mr Ong Tong Hai has been purchasing shares of the steel company in the open market since May 23 at between 21 cents and 22 cents per share, which is higher than 3HA Capital&rsquo s offer price.

 

The Ongs also noted that the four-party consortium behind 3HA Capital are direct competitors of CosmoSteel. They include Hanwa Singapore, which is a subsidiary of Hanwa Co, a Japan global steel trader which currently holds a 31.6 per cent stake in CosmoSteel.

 

&ldquo Their acquisition of a controlling stake raises serious questions about future strategic direction, potential conflicts of interest, and the independence of the company&rsquo s operations,&rdquo the Ongs said.

 

They warned that accepting 3HA Capital&rsquo s offer could mean giving up long-term value for short-term liquidity, in a deal structured under incomplete disclosures and involving parties who may not prioritise the interests of minority shareholders.

 

They said in their statement: &ldquo We call upon the board of CosmoSteel to fully evaluate and address these concerns in their formal response to the offer, and to act in the best interests of all shareholders.

 

&ldquo It is important that we do not let short-term fear or misleading representations deny us of long-term value.&rdquo

 

The family is speaking out amid a rise in low-priced offers for SGX-listed firms in recent years, some of which cite low liquidity as a justification and put pressure on minority shareholders to accept early under the threat of trading suspension.

 

One example is Boustead Singapore&rsquo s offer for its subsidiary, Boustead Projects, for 90 cents per share in 2023. After the Securities Investors Association (Singapore), or Sias, called the offer a &ldquo low-ball&rdquo one that undervalued the company, it was raised to 95 cents.

 

An IFA nevertheless deemed the offer unfair but reasonable, as the price was below its $1.17 to $1.38 valuation range, but reflected the stock&rsquo s illiquidity.

 

When Boustead Projects&rsquo public float subsequently fell to just 4.5 per cent, which is below the 10 per cent requirement, trading in its shares was suspended. The SGX then directed Boustead Singapore to make a fair and reasonable exit offer for Boustead Projects. A final offer of $1.18 was accepted by over 90 per cent of independent shareholders, and the company was delisted in February 2024.

 

In a November 2023 commentary, Sias president David Gerald had urged minority shareholders not to feel pressured into accepting unfair offers for shares they have likely held for years, adding that the risk of indefinite trading suspension should not be used to justify accepting unreasonable prices.

 

&ldquo The 4.5 per cent who held out have shown that individually they may not be able to make much of a difference, but collectively they can exercise considerable clout,&rdquo he said then.

 

Meanwhile, some minority shareholders of Great Eastern (GE) have urged the Securities Industry Council (SIC) to consider amendments to Singapore&rsquo s takeover and mergers code to promote fair treatment of all shareholders involved in privatisation offers.

 

They include addressing the prolonged suspension of trading in the shares of target companies in a privatisation deal, and imposing stronger obligations on the company&rsquo s directors to seek better alternatives for minority shareholders when offers are unattractive.

 

GE is expected to announce a final proposal to meet SGX&rsquo s free float requirements no later than June 8. The company&rsquo s shares have been suspended from trading since July 2024, after falling below the 10 per cent threshold following a takeover bid by OCBC Bank, its majority shareholder.

 

OCBC has managed to secure 93.52 per cent of GE&rsquo s shares, short of the 95 per cent needed for a compulsory acquisition and delisting, after some minority shareholders resisted the offer, arguing that OCBC&rsquo s bid of $25.60 per share undervalues the insurer.

 

Said Mr Ong Chin Woo, who is among those who have resisted: &ldquo Investors, especially retail investors, lack the resources and means to fight for their interests. Hence, they are particularly dependent on the protection of the code to get a fair and reasonable outcome from their investment.&rdquo

 

Amid an ongoing consultation by the SIC to amend and strengthen the code, Ms Stefanie Yuen Thio, joint managing partner at TSMP Law, noted that it would be useful to have more avenues for minority shareholders to band together to discuss any offer and, if they think fit, to reject the offer.

 

&ldquo Right now, it&rsquo s almost impossible for shareholders to do that &ndash they have no means to contact other shareholders and it&rsquo s for bodies like Sias to convene a meeting,&rdquo she said, adding that she has been calling for the law to be changed to facilitate shareholder activism and self-help.

Between May 23 and 27, Cosmosteel Holdings executive director and CEO Jack Ong acquired 500,000 shares at an average price of S$0.220 apiece, increasing his direct interest from 16.81 per cent to 17 per cent. This follows his acquisition of 6,050,000 shares between May 20 and 22. On May 15, Evolve Capital Advisory, on behalf of 3HA Capital, announced a voluntary conditional cash offer for all issued and paid-up ordinary shares of Cosmosteel Holdings at S$0.20 apiece. 

 

Between May 20 and 22, Cosmosteel Holdings executive director and CEO Jack Ong acquired 6,050,000 shares at an average price of S$0.219 apiece, increasing his direct interest from 14.50 to 16.81 per cent. Ong leads corporate strategy and drives sales to major end-users and oil majors. Since joining in 1998, he has built deep expertise in the group&rsquo s operations and logistics in the steel industry.

 

On May 15, Evolve Capital Advisory, on behalf of 3HA Capital, announced a voluntary conditional cash offer for all issued and paid-up ordinary shares of Cosmosteel Holdings at S$0.20 apiece. Ong, his brother Ong Tong Yang and father Ong Chin Sum have since raised queries to the offeror to ensure that all shareholders have the necessary information to assess the offer. 

Jack Ong Tong Hai, CEO of Cosmosteel Holdings, has again bought shares in the open market to increase his stake.

 

On May 22, Ong paid 22 cents each for 500,000 shares, bringing his total stake to more than 43.9 million shares, equivalent to 16.81%, up from 16.62% earlier.

 

Ong had on May 20 paid nearly 22 cents each for 5.55 million shares.

 

Ong' s actions came after a group of investors on May 15 launched a takeover offer for the company at 20 cents each.

 

This group of investors include a subsidiary of Cosmosteel' s single largest shareholder Hanwa Co, a Tokyo-listed trader of steel and other materials which now owns 31.61% of Cosmosteel.

Jack Ong Tong Hai, CEO of Cosmosteel Holdings, has beefed up his stake by snapping up shares of his company from the open market amidst a takeover offer.

 

The price paid by Ong is above the 20 cents per share offer tabled on May 15 by an entity called 3HA Capital.

 

On May 20, Ong paid a total of more than $1.2 million for 5.55 million shares, which works out to a range of between 21.7633 cents to 21.8721 cents. This brings his total stake to more than 43.4 million shares, or 16.62%, up from 14.5% previously.

 

As indicated in Cosmosteel' s annual report, as at Dec 11 2024 Ong' s brother, Ong Tong Yang holds another 7.63% of the shares.

 

Cosmosteel' s single largest shareholder is Hanwa Co, a Tokyo-listed trader of steel and other materials which now owns 31.61% of Cosmosteel.

 

3HA Capital is made up of parties including Hanwa Singapore, a subsidiary of Hanwa Co. Other parties in the offeror include HHH Group, Bursa-listed AYS Ventures Bhd and Thor Capital.

 

The offer price of 20 cents is 48.1% over the last traded price of 13.5 cents on May 14. However, it is a discount to the company' s NAV of 29.31 cents as at March 31.

 

The offeror says it plans to continue to develop and grow Cosmosteel' s existing businesses and will undertake reviews from time to time to consider options.

 

Cosmosteel has been included in the SGX watch-list since 2018 and the exchange has given Cosmosteel up to June 4 to exit the watch-list.

 

If the offeror receives more than 90% of the shares, it might then exercise the right to compulsorily acquire the remaining shares and to then delist the company.

 

Meanwhile, 3HA Capital plans to maintain Cosmosteel' s listing status.

 

In a separate announcement, the company announced the resignation of its financial controller Benjamin Ng Loong Tatt, who will leave on Aug 15.

 

Ng joined the company just last September and according to Cosmosteel' s announcement, is leaving for " personal reasons" .

 

A group of investors including the controlling shareholder of Cosmosteel Holdings is offering 20 cents per share for the mainboard-listed piping steel supplier.

 

The offer is made via an entity called 3HA Capital, whose shareholders include Hanwa Co, a Tokyo-listed trader of steel and other materials which now owns 31.61% of Cosmosteel. Other parties in the offeror include HHH Group, Bursa-listed AYS Ventures Bhd and Thor Capital.

 

The offer price of 20 cents is 48.1% over the last traded price of 13.5 cents on May 14. However, it is a discount to the company' s NAV of 29.31 cents as at March 31.

 

" The offer presents shareholders with a clean cash exit opportunity to realise their entire investment in the shares at a premium over the historical traded prices of the shares without incurring brokerage and other trading costs," reads the offeror' s announcement on May 15.

 

The offeror says it plans to continue to develop and grow Cosmosteel' s existing businesses and will undertake reviews from time to time to consider options.

 

Cosmosteel was listed on SGX back in 2007 and has been included in the SGX watch-list since 2018 for incurring losses in the three preceding financial years. SGX has given Cosmosteel up to June 4 to exit the watch-list.

 

If the offeror receives more than 90% of the shares, it might then exercise the right to compulsorily acquire the remaining shares and to then delist the company.

 

In the meantime, the offeror plans to maintain Cosmosteel' s listing status.

On Jan 25, CEO Jack Ong Tong Hai acquired 2.75 million shares at an average price of S$0.13 per share. With a consideration of S$360,938, this took his direct interest from 13.45 per cent to 14.50 per cent.

 

Ong is responsible for steering the group&rsquo s corporate and business strategies as well as leading sales and marketing to major end-users and oil majors.

 

He first joined the group in 1998. He has comprehensive, well-rounded experience and deep-seated knowledge of both the group and the steel industry, in particular, the group&rsquo s logistics and operations functions.

 

Since joining the group, he has also acquired in-depth management experience in inventory and warehousing logistics and management, information systems and technology management and administration.

 

In May 2023, CosmoSteel Holdings announced its intention to acquire a warehouse in the industrial region of Johor, Malaysia for RM21 million (approximately S$6.3 million), which was approved by shareholders at the EGM held in October 2023.

 

Ong said CosmoSteel Holdings will be commencing the relocation of part of its inventories to the warehouse in Malaysia in Q3FY24 (ending Jun 30) with the strategic imperative to reduce the group&rsquo s operating cost structure so that it can be more sustainable in the long term.

 

He added that there is a cost advantage for the group to relocate a part of its warehouse operations in Malaysia and that overall, he believes the move will enhance the group&rsquo s cost efficiency and empower it to operate more competitively as an inventory specialist.

 

CosmoSteel Holdings&rsquo extensive product inventory includes steel pipes, fittings, flanges, cables, and cable management, as well as structural products.

 

For its FY23 (ended Sep 30), the group recorded a 23.1 per cent year-on-year increase in net profit to S$2.8 million. This was achieved on the back of an 81.1 per cent year-on-year increase in revenue to S$83.4 million.

 

Ong has also highlighted that another reason for acquiring the warehouse in Malaysia stems from the group&rsquo s desire to give CosmoSteel sufficient headroom and flexibility to scale up for future expansion.

 

Accordingly, it intends to ramp up sales and marketing efforts to grow its business from existing as well as new customers.

 

Ong has also noted that following the relocation, a substantial part of the warehouse at 90 Second Lok Yang Road will be freed up, presenting an opportunity for divestment.

 

CosmoSteel Holdings and its subsidiaries is backed by close to 40 years of established track record as a service-oriented and reliable solutions provider in the sourcing and distribution of piping system components in the energy, marine and other industries in South-east Asia and other regions.

 

CosmoSteel Holdings had announced in June 2023 that it had obtained an extension of time up to Jun 4, 2024, to meet the exit criteria for the watch-list by SGX, under the financial entry criteria.

 

PIPING systems provider CosmoSteel Holdings said it has maintained profitability in the third quarter of its financial year ending Sept 30, but guided for further revenue impairment amid the Covid-19 outbreak.

 

In view of the continued impact of the pandemic, the company has continued its cost-cutting measures and managed to reduce its finance costs, marketing and distribution costs and administrative expenses, it said in regulatory filing on Wednesday. It is also focusing on selling second-hand inventory at a profit, and on the reversal of whatever previous provisions made for such inventory.

 

Still, the mainboard-listed company remains on the Singapore Exchange' s watch-list as it failed to meet the exit criteria as at June 30.

 

CosmoSteel said the pandemic and its " knock-on" economic impact is expected to continue to " impair and adversely affect" its ability to secure new projects and generate revenue for the rest of the financial year.

 

It continues to explore projects to increase revenue and expand or diversify its existing products or services and/or markets, and to meet the market cap requirement of S$40 million under the watch-list' s exit criteria.

 

In May, the company obtained an extension till June 5, 2022, to meet the exit criteria. If it is able to maintain its profitability in FY2021, it will be able to satisfy one of the conditions, the other being the requisite market cap.