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Monday, February 8, 2021-11: 19 am
UPDATED Monday, February 8, 2021 – 12:36 pm
Shares in the entertainment group mm2 Asia, which is traded on the motherboard, fell as much as 29 percent to a record low of 8.5 Singapore cents in early trading on Monday, when the market began pricing a potential new investment. , as well as a proposal to issue rights.
This comes a day after the group announced that a Singaporean private equity investor is interested in investing in one of its core businesses, without specifying the business area.
The news also comes shortly after mm2 Asia announced that, on February 2, it had received approval in principle for a proposed issuance of waivable subscribed rights.
The rights issue is intended to raise net proceeds of approximately S $ 52.2 million, which will be used to pay the medium-term note due April 27, 2021 and for working capital and general operations. The issue price of 4.7 Singapore cents per share of rights represents a discount of 60.8 percent from the close on February 1 of 12 cents and a discount of 43.7 percent from its price. theoretical ex rights of 8.35 cents based on its February 1 close. being the last trading day before this presentation.
The accountant regained some ground to trade at 9.9 Singapore cents at 10.46 am Monday, 2.1 cents or 17.5 percent down, with some 4.8 million shares changing hands. No married deals were recorded in the first trades, according to ShareInvestor data.
mm2 Asia had requested a commercial suspension on February 2 “pending the publication and completion of a material announcement,” which lasted until the end of February 5.
In a stock exchange presentation on Sunday evening, mm2 Asia said it had received a non-binding term sheet, expressing interest in a possible acquisition that involves taking a minority stake in one of the group’s core businesses.
“The terms of this term sheet are being deliberated by the board, and the term sheet has not been entered as of the date of this announcement,” he said, adding that the board may also appoint an independent financial advisor if it deems it necessary.
mm2 Asia also noted that confidentiality commitments prevent it from revealing the identity of the investor or other proposed terms at this stage.
The group’s core business is the production and distribution of content, including film, television and online releases. In addition to its core business, other business segments include cinemas, concerts and events, and publishing and digital content production. Unusual Limited, listed on Catalist, is the event production unit of mm2 Asia.
In addition to Singapore, mm2 Asia also has a presence in Malaysia, Hong Kong, Taiwan and China. Over the years it has produced or co-produced and / or distributed more than 20 films, according to data from the Singapore Exchange (SGX). Some of his notable productions include Ah boys to men which was directed by local filmmaker Jack Neo.
In Sunday’s announcement, mm2 Asia said that the term sheet, if signed, would provide the investor an exclusive 90-day period to conduct a preliminary due diligence exercise and for the parties to prepare and negotiate the terms of the credit agreements. binding investment.
For the agreement to proceed, the terms on the term sheet must be finalized, approved by the board, and signed by all parties. Any potential transaction would also require binding investment agreements to be negotiated and finalized, with more conditions to follow, including shareholder approval.
There is no certainty that the investment transaction will proceed, or whether the discussions will result in binding agreements, mm2 Asia said.
The group added that it is making the announcement “to keep its shareholders and interest groups informed about the evolution of its business and possible corporate actions, particularly in light of the proposed issuance of waivable subscribed rights.”
mm2 Asia made its debut on the SGX Catalist board in 2014. It was later carried over to the SGX motherboard in August 2017.
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