PAWNSHOP owner and jewellery retailer Aspial Lifestyle is expanding its operations in Malaysia with the acquisition of 65 per cent of pawnbroking business Maxion Holdings for RM30.7 million.

 

The deal, which remains subject to certain conditions, also includes a put option for Aspial to acquire the rest of Maxion Holdings. Aspial may exercise this option between Jan 1, 2027 and Dec 31, 2032, but will not be required to buy more than 10 per cent of Maxion in a year.

 

In an announcement on Dec 1, Aspial said it expects the acquisition to be accretive to its financial results.

 

For FY2022 ended Sep 30, the net profit attributable to the stake in Maxion would have been RM4.6 million. As at end-September, the 65 per cent stake had a book value of RM19.3 million ringgit.

 

Assuming the proposed acquisition had been completed on Jan 1, 2021, Aspial&rsquo s earnings per share for FY2021 ended Dec 31 would have improved to 1.45 Singapore cents from 1.4 Singapore cents.

 

Aspial was formerly known as Maxi-Cash Financial Services Corporation and operated a chain of pawnbrokers under the Maxi-Cash brand. The company changed its name in October after it acquired several businesses, including jewellery brand Lee Hwa Jewellery, from its parent company Aspial Corporation : A30 0%.

 

Maxi-Cash already operates pawnbroking outlets in Johor and Selangor. Aspial therefore believes the proposed acquisition will &ldquo strengthen its presence in Malaysia and provide opportunities for the group to grow by enhancing its local network and customer base&rdquo .

 

Maxion owns the Pajak Gadai Ion pawn shop in Malaysia.

 

Aspial intends to fund the purchase with existing cash and bank borrowings.

Tan Su Lan is also the name of Aspial chief executive officer Koh Wee Seng&rsquo s mother, who founded one of the group&rsquo s brands, Lee Hwa Jewellery.

A WOMAN named Tan Su Lan has received a civil penalty of S$100,000 for false trading in the shares of jewellery retailer Aspial Corporation and property developer Far East Orchard (FEO), the Monetary Authority of Singapore (MAS) announced on Wednesday (May 11).

 

In its press statement, MAS said that Tan had executed her trades in a manner that was likely to create a false appearance with respect to the price of the shares.

 

The authority noted that she was also &ldquo reckless&rdquo as to whether the trades would be likely to create such a false appearance.

 

Specifically, Tan had purchased shares of Aspial and FEO near or during the close of the days&rsquo trading sessions for 3 consecutive days in May 2016. This resulted in her purchases artificially raising and setting the closing prices of both counters on all 3 days.

 

Shares of both companies were pledged by Tan as collateral for share margin purposes. As the closing prices of Aspial and FEO had an impact on the value of her collateral, Tan&rsquo s collateral increased correspondingly.

 

Tan has admitted liability for her actions and paid MAS the civil penalty.

 

Tan Su Lan is also the name of Aspial chief executive officer Koh Wee Seng&rsquo s mother, who founded one of the group&rsquo s brands, Lee Hwa Jewellery.

 

&ldquo Trading behaviour that has the effect of distorting prices adversely affect the fair and orderly functioning of our capital markets. MAS will take firm action against participants who are reckless as to whether their trades are likely to create a false appearance in the prices of securities,&rdquo said Loo Siew Yee, assistant managing director of policy, payments and financial crime at the MAS.

  Jewellery group Aspial Corp will be taking its subsidiary World Class Global (WCG) private after gaining 98.48 per cent shareholder approval in a scheme meeting on Monday (June 15), the companies said in separate filings with the Singapore Exchange (SGX).

 

In the meeting, which was held electronically, 194 shareholders present or voting by proxy, representing 98.48 per cent of votes, moved to approve the scheme. The shareholders who were for the scheme held about 50.4 million or 99.99 per cent of WCG' s shares.

 

Three shareholders, representing 1.52 per cent of votes and 0.01 per cent of shares, were against the scheme.

 

Under the scheme of arrangement, all WCG shares held by its shareholders - other than those held by Aspial - will be transferred to Aspial. The shareholders will receive new ordinary shares in Aspial in exchange, at a rate of 21 cents per WCG share to 19 cents per Aspial share.

 

For illustration, a shareholder holding 100 WCG shares would receive 110 Aspial shares in exchange for the former.

 

Listed on SGX' s Catalist board in 2017, WCG was spun off from Aspial. Its key businesses include property development and property investment in major cities in Australia and Malaysia, as well as the operation of hotels in Malaysia.

 

In the light of the approval received, WCG will be submitting its application to the court for sanction of the scheme.

 

In its indicative timetable, WCG has set July 7 as the expected date of its court hearing of the application to sanction the scheme, with July 16 being the latest expected date for the payment of the scheme consideration and July 19 the latest expected date of delisting for its shares.

 

Shares of Aspial were trading flat at 12.8 cents as at the midday break on Monday. Shares of WCG were at 14.8 cents. This was after a trading halt was called, then lifted on Monday morning.

JEWELLERY group Aspial Corp on Friday announced plans to privatise its subsidiary World Class Global through a scheme of arrangement, to simplify the group' s structure.

 

World Class Global was spun off from Aspial and listed on the Singapore Exchange' s Catalist board in 2017. Its main businesses include property development and property investment in major cities in Australia and Malaysia, as well as the operation of hotels in Malaysia.

 

Under the proposed scheme, all World Class Global shares held by its shareholders - other than those held by Aspial - will be transferred to Aspial. The shareholders will receive new ordinary shares in Aspial in exchange, at a rate of S$0.21 per World Class Global share to S$0.19 per Aspial share.

 

This means that a shareholder holding 100 World Class Global shares would receive 110 Aspial shares in exchange for the former.

 

Based on the more than 173 million shares held by World Class Global shareholders other than Aspial, representing about 18.9 per cent of the total shares, as at Friday, the total consideration for the scheme is about S$36.3 million. It means Aspial would have to issue up to some 191 million new shares.

 

The scheme is conditional upon the approval of Aspial' s shareholders at an extraordinary general meeting to be convened.

 

Aspial noted that the consideration of S$0.21 per World Class Global share represents a premium of about 107.9 per cent over the one-month volume weighted average prices of the shares, up to and including March 11, which is when they last traded.

 

Aspial also noted that the closing share prices of World Class Global have not traded over S$0.21 since Jan 24, 2019.

 

The scheme is an opportunity for shareholders to exit their investment in World Class Global, while continuing to participate in its future growth through the enlarged group, Aspial said. " This may otherwise be difficult due to the low trading liquidity of the World Class Global shares and the challenging global and domestic economic outlook brought about by the Covid-19 pandemic."

 

Last month, World Class Global reported a full-year net loss of S$6.64 million, reversing from a S$13.63 million net profit a year ago. 

 

Revenue for the year ended Dec 31, 2020, was S$169.54 million, a 17 per cent year-on-year decline. This was revenue recognised from the settlements by purchasers of the Australia 108 residential development in Melbourne, the group had said.

 

World Class Global had also said that the outlook for the year ahead remains challenging with &ldquo global and domestic economic uncertainties&rdquo due to the pandemic.

 

In Australia, construction of Australia 108 had been completed last October and some of the available units have been leased out to generate rental income.

 

In Malaysia, the group&rsquo s hotel business in Penang have been adversely affected, with the completion of building works for four hotels under construction delayed to H2 2021, due to the government&rsquo s movement control order.

JEWELLERY and property player Aspial Corp saw its earnings fall 63 per cent to S$5.5 million for the half-year ended June 30, with its topline hit by the fall in retail sales amid the Covid-19 pandemic.

 

Aspial also did not declare an interim dividend this year to retain cash for working capital. The company had declared an interim dividend of 0.38 cents per share for the corresponding period last year.

 

The company&rsquo s H1 revenue fell 25.1 per cent to S$234.2 million, due to lower contributions from both its real estate and jewellery segments. This was partly offset by its financial-services segment.

 

Its real estate revenue fell 38.6 per cent to S$98.7 million in H1. Its revenue for the period mainly came from its Australia 108 project in Melbourne, which will achieve full completion this year.

 

Likewise, the jewellery business&rsquo revenue fell 46.4 per cent to S$34 million, as retail shops were closed during the circuit-breaker period.

 

However, revenue from the financial-service business rose 11.7 per cent to S$102.8 million, due to higher contributions from pawnbroking and the trading of jewellery. This was partially offset by lower revenue from the retail of jewellery and branded merchandise in Singapore, as well as the secured lending business.

 

Looking ahead, Aspial expects challenging conditions to persist. &ldquo The Covid-19 pandemic has led to major disruptions in supply chain and cross-border travel affecting the economy, employment and retail sentiments. Although governments have provided various short-term subsidies and support, the group will need to strengthen its product and service innovation,&rdquo the company said.