SINGAPORE (THE BUSINESS TIMES) – Leisure group mm2 Asia on Wednesday (Dec 8) stated it should pause the spin-off and itemizing of its cinema enterprise on the Catalist board of the Singapore Alternate (SGX) because it seemingly doesn’t adjust to chain itemizing necessities.
The mainboard-listed firm had sought SGX’s clearance for the preliminary public providing (IPO) previous to submitting its pre-admission notification, however was suggested that the proposed spin-off doesn’t adjust to necessities beneath Rule 210(6) of the itemizing handbook, based mostly on the corporate’s representations and the group’s monetary data for the previous 3 monetary years.
Underneath the rule, SGX will usually not approve the itemizing of a subsidiary of a listed issuer if the belongings and operations of that subsidiary are considerably the identical as that of the listed issuer.
mm2 Asia had stated on August 10 that it might pursue the Catalist itemizing of its cinema enterprise – which operates beneath the Cathay model – in parallel with its proposed sale.
The corporate on Aug 30 inked a non-exclusive sale and buy settlement with native funding agency Kingsmead Properties to promote its cinema enterprise for $84.8 million.
Cinemas have been badly harm by closures and restrictions arising from the Covid-19 pandemic and mm2 Asia’s cinema enterprise was to be bought at an anticipated lack of $84.7 million, representing the deficit of proceeds over the e book worth.
In its Wednesday submitting, mm2 Asia stated it won’t submit a pre-admission notification “at this level of time” and can revisit the IPO course of sooner or later “if acceptable”. Within the meantime, it plans to look to proceed creating its enterprise and exploring different avenues to maximise shareholder worth.
The corporate added that it’ll announce materials developments on the proposed spin-off as and when acceptable.
The group’s cinema enterprise is presently performed by means of its wholly-owned subsidiary, mm Join, and its subsidiaries. In December final yr, mm2 had deliberate to spin off the enterprise to permit it to be financially unbiased and lift funds for brand spanking new development alternatives with out counting on the group.
mm2 Asia purchased Cathay Organisation’s eight cinemas throughout Singapore for $230 million in November 2017, including to the 19 film theatres it already operated throughout the Causeway. It seemed to Cathay after its bid to take a 50 per cent stake in Singapore’s Golden Village cinema enterprise for $184 million was blocked by Hong Kong’s Orange Sky Golden Harvest Leisure (Holdings).
Shares of mm2 Asia closed at 5.2 cents on Wednesday, up 0.1 cent or 2 per cent, earlier than the announcement.
•With further data from The Straits Instances