The audit committee has &lsquo reasonable evidence&rsquo that four whistleblower reports received by the board are credible

 

The audit committee of Aoxim Q& M Dental has found &ldquo reasonable evidence&rdquo that the company&rsquo s former chief executive officer, Dr Shao Yongxin, obtained some 15 million yuan (S$2.7 million) for personal use from employees and minority shareholders. 

 

The findings, which stem from an investigation into four separate whistleblowing reports, were released by Aoxim Q& M in a bourse filing on Monday (Sep 8).

 

Dr Shao was accused of obtaining two million yuan in or around 2017, by purporting to sell 2.8 million company shares that he had claimed to own. Additionally, he allegedly obtained another 13 million yuan through personal loans from certain whistleblowers between 2017 and 2022.

 

The audit committee found the claims made in the reports credible, after whistleblowers provided copies of the signed share entrustment and loan agreements. In contrast, Dr Shao did not respond to the committee&rsquo s e-mail queries and resigned abruptly on Jul 21, 2025, shortly after the board first learned of the allegations.

 

The committee&rsquo s legal counsel advised that the share sale is not enforceable against the company because the shares were already pledged as security to Q& M Dental Group, meaning Dr Shao lacked unencumbered ownership. 

 

His conduct also likely breached the Companies Act and the Securities and Futures Act, for failing to disclose changes to his shareholding interests. The committee concluded that these actions, constituting a potential abuse of power over employees, rendered him not &ldquo fit and proper&rdquo as a director under the Singapore Exchange&rsquo s Catalist Rules.

 

The company has also sought legal advice from its lawyers in China, on the potential legal liabilities there arising from Dr Shao&rsquo s purported share sale agreement. 

 

The lawyers have advised that any liabilities will mainly relate to &ldquo the potential criminal and/or civil liabilities he may face (in China) due to his conduct of inducing the whistleblowers to buy the purported sale shares&rdquo .

 

To check for other potential issues, the audit committee hired a commercial investigator to run background checks on Dr Shao. The goal, the company said, was to see if he was in financial troubles or if there were other warning signs of improper conduct that might affect the company.

 

The investigation found no other adverse issues or evidence of financial distress, aside from a previously disclosed matter involving Q& M Dental Group. The report noted his four current business interests are his roles within the company&rsquo s Chinese subsidiaries.

 

The company also clarified that it would have fired Dr Shao over his conduct, even if he had not resigned. It added that it will take action to recover the salary he owes for failing to serve his required six-month notice period. 

 

Aoxin operates dental hospitals and polyclinics in four different cities in Liaoning province in Northern China. It also distributes dental equipment and supplies.

Revenue rises 4.6% to 86.8 million yuan, from 83 million yuan in the year-ago period

 

[SINGAPORE] Catalist-listed Aoxin Q& M Dental : 1D4 0% on Thursday (Aug 14) posted a 44.3 per cent fall in net profit to 2.7 million yuan (S$488,100) for the six months ended Jun 30, from 4.9 million yuan in the year-ago period.  

 

This translated to a 44.8 per cent year-on-year decline in earnings per share to 0.0053 yuan from 0.0096 yuan. 

 

Revenue for H1 stood at 86.8 million yuan, 4.6 per cent higher on the year from 83 million yuan. 

 

This came on the back of higher revenue contributions from its distribution of dental equipment and supplies and laboratory services segments, which notched revenue growth of 12.6 per cent and 11.3 per cent, respectively, compared to the year-ago period. Its primary healthcare segment&rsquo s revenue inched up 0.6 per cent. 

 

The group did not declare a dividend for the six months. 

The move follows Dr Shao&rsquo s resignation on Jul 22 after a whistle-blower report against him was sent to company&rsquo s audit committee

 

[SINGAPORE] Aoxin Q& M : 1D4 -2.04% announced that it has placed former chief executive officer Shao Yongxin under suspension to facilitate its whistle-blowing investigation, in a bourse filing on Thursday (Jul 31).

 

Dr Shao is in the midst of relinquishing all his duties, including his directorships in subsidiary companies in Aoxin Q& M. General manager Bai Yi and deputy general manager Huang Zhengxing will lead the business operations in the interim.

 

This move comes after Dr Shao resigned on Jul 22 after a whistle-blower report against him was sent to Aoxin Q& M&rsquo s audit committee. 

The board of directors of Aoxin Q& M Dental Group says minimal impact is expected on the operations and financials of the company as a result of the resignation of its executive director and chief executive Shao Yongxin.

 

The Catalist-listed company, which is a Chinese spin-off from mainboard listed Q& M Dental, filed responses to SGX&rsquo s queries in relation to the resignation on July 22.

 

Ex-CEO Shao announced his resignation from the company after a whistle-blower report against him was made by the company&rsquo s audit committee (AC) on July 21.Aoxin cited &ldquo differences in views and opinions&rdquo with its parent, mainboard-listed Q& M Dental Group, regarding the strategic direction of the dental business as the reason for Shao&rsquo s resignation.

 

As such, the SGX has raised several queries about the matter. This includes clarification on the differences in opinion and matter between Shao and the board of directors.

 

&ldquo The AC, upon receipt of the first whistle-blowing report and documents, commenced its preliminary investigations and initial fact gathering. Given that the whistle-blowing reports are received only a few days ago, internal investigations are still ongoing. The AC is currently in discussion with relevant professionals and official appointments are targeted to be made by next week,&rdquo reads Aoxin&rsquo s reply.

 

It also notes that as the healthcare industry in the People&rsquo s Republic of China is undergoing major transformation, differences arose between Shao and Q& M Dental in respect of the future direction of the group.

 

SGX also asked for the board to clarify if this cessation will have an impact on the company&rsquo s operations and financials.

 

In response, the board notes that at this preliminary stage of investigations, it does not forsee any significant impact to the group as the whistle-blowing case relates to Shao&rsquo s past personal actions and is unrelated to the group&rsquo s operations. The AC targets to complete the investigation within three months.

 

Meanwhile, Aoxin&rsquo s board notes that they are currently sourcing for an appropriate candidate for the role of executive director of the group, while the business operations continue to be managed by general manager Bai Yi.

Hong Leong Finance will advise the recommending directors on the offer

 

[SINGAPORE] Catalist-listed Aoxin Q& M : 1D4 0% has appointed Hong Leong Finance as the independent financial adviser (IFA) for the mandatory unconditional cash offer made by Q& M Dental Group : QC7 0%, said the board via a bourse filing on Friday (May 9).

 

The board stated that its IFA will advise the recommending directors on the offer, with a circular outlining the adviser&rsquo s advice and the directors&rsquo recommendation to be sent to shareholders within 14 days of the dispatch of the offer document by Q& M.

 

In the meantime, the board advised shareholders to exercise caution when dealing in their shares and to refrain from taking any action that could be detrimental to their interests until they have reviewed this circular.

 

The appointment of its IFA follows a bourse filing on May 1, in which the board informed shareholders that Q& M Dental Group intends to acquire the remaining shares it does not already own in Aoxin Q& M at S$0.0321 per share. 

 

The offer will close at 5.30 pm on May 28. If fully accepted, Q& M will pay about S$8.1 million for the offer shares.

 

This development came after Q& M increased its stake in Aoxin Q& M from 33.33 to 50.53 per cent. In accordance with Rule 14.1 of the Singapore Code on Take-overs and Mergers, Q& M is required to make a cash offer for all remaining shares not already owned, controlled, or agreed to be acquired.

 

Q& M previously stated that it does not plan to make any material changes to Aoxin Q& M&rsquo s business operations following the acquisition and intends to maintain the company&rsquo s listing on the Singapore Exchange.

 

Aoxin Q& M has triggered a query by the Singapore Exchange Regulation (SGX RegCo) after shares in the company surged by 44% to 12.1 cents as at 9.56am on July 21, from its last-closed price of 8.4 cents.

 

While shares in the company fell slightly to 11.3 cents, this was still deemed a month-long high since its shares fell to 8.3 cents in early July.

 

In its query, SGX RegCo has asked Aoxin to release any information that may have brought about the &ldquo unusual price movements&rdquo and to confirm its compliance with the Catalist listing rules.

AOXIN Q& M reported narrowing losses to 3.4 million yuan (S$691,340) in H1 2022 from 6.1 million yuan due to its share of associate results.

 

Revenue fell 20.8% to 65.1 million yuan from 82.3 million yuan. This was mainly due to temporary closures resulting from the resurgence of Covid-19 from end of March to May 2022 which impacted all business segments.

 

&ldquo The group expects its performance for FY2022 to continue to be impacted by Covid-19 in the event there is a resurgence of Covid-19 virus in China,&rdquo said Dr Shao Yongxin, chief executive officer, Aoxin Q& M.

 

The share of associate&rsquo s profit helped narrow losses, with Acumen Diagnostics contributing 3.2 million yuan for H1 2022 after being acquired on Nov 1, 2021. The company reports that all their dental clinics and hospitals are currently in operation.

 

&ldquo Overall, the group expects the business environment to remain challenging for the second half of 2022.&rdquo said Dr Shao.