Magazine publisher Arion Entertainment Singapore is seeking shareholders’ go-ahead to diversify into the property and moneylending fields.
In a circular to shareholders on Feb 1, the mainboard-listed company described its core business in events and publishing as “increasingly challenging and competitive”.
The company will be holding its virtual EGM on Feb 16.
“The Covid-19 pandemic has impacted the global economy significantly and is expected to have an adverse impact on the Group’s operations in Malaysia in the financial year ending Mar 31, 2021... The Board believes that entry into the Property Business and Moneylending Business is beneficial to further diversify the Group’s business in order for the Group to remain competitive,” reads the circular.
Arion Entertainment Singapore is an investment holding company with business activities in Malaysia which is involved in the sale and publishing of magazines and periodicals and events management.
In November, Arion reported 1HFY2021 revenue of $493,000 from its Malaysian publishing operations, a marginal increase from $477,000 y-o-y. In addition, Arion received $13,000 through the Jobs Support Scheme.
For more stories about where the money flows, click here for our Capital section
The company reported a net loss of $196,000 for 1HFY2021, from a loss of $407,000 a year before.
Employee compensation decreased by 39.7% to $0.28 million in 1HFY2021 as compared to $0.46 million in 1HFY2020 due mainly to a decrease in the remuneration of the executive director, who had voluntarily reduced his remuneration commencing from January 2020.
Cash and cash equivalents as at end of 1HFY2021 was $3.40 million as compared to $2.10 million h-o-h. No dividend was declared for the six months ended Sept 30, 2020 as the group was loss making.
In the circular, the company outlines plans to enter real estate brokerage services, franchising, leasing, investment, development, property financing to corporations and individuals, and personalised debt management advisory services.
“The Executive Director of the Company, Mr Ng Kai Man, is familiar with and has a wide network of associates to leverage in seeking out opportunities in Hong Kong and/or Singapore,” says the company. Ng is the company’s largest shareholder with a 9.93% stake.
Property interests
Ng also owns Century 21 Singapore Holdings and Menkin, which in turn owns the entire issued and paid-up capital of Century 21 Hong Kong.
The Century 21 Entities are primarily engaged in the franchising business. The Century 21 Entities grant sub-franchises and sublicense the trademark and the franchise system to licensed real estate brokers in Singapore, Hong Kong and Macau, to provide brokerage services for mass market sale and purchase of residential and commercial property units.
“The Board is of the view that the Century 21 Businesses do not compete directly or indirectly with the franchising business of the Property Business as the Century 21 Businesses are conducted in Singapore, Hong Kong and Macau… It is intended that the franchising business of the Property Business will be carried on in a country other than the said three territories,” says the company.
Subject to shareholders’ approval, the company intends to enter into a non-compete undertaking with Ng. In addition, he intends to grant a right of first refusal in favour of the Group in relation to any proposed offer by him or his associates to sell, transfer or otherwise dispose of any interest in any of the Century 21 Businesses while he is involved as owner, or while the company is listed on the mainboard.
Ng’s daughter, Ng Yan Pui, is also owner and director of C21 Group, one of the real estate brokerage franchisee companies operating under the brand in Hong Kong. Similarly, the company intends to enter into a non-compete undertaking with the younger Ng.
Aside, Lee Keng Mun, an independent director of Arion, is the Chief Operating Officer of AsiaPacific Strategic Investments Limited (formerly known as China Real Estate Group Ltd). APSI is primarily engaged in the business of property development and management in China, and does not presently have any business in Singapore and Hong Kong.
SEE: The risk pandemic
As an independent director, Lee will not be involved in the day-to-day operations and management of the group, whether directly or indirectly, says Arion.
Arion Entertainment Singapore was incorporated in 1994 as Panpac Media Group, and has undergone multiple name changes.
Formerly known as The Lexicon Group, the Group was listed on Singapore Stock Exchange (SGX) in 1997.
The Group renamed to Elektromotive Group in 2011 following the acquisition of Elektromotive Limited (United Kingdom). On Jan 26, 2017, the Company changed its name to Arion Entertainment Singapore upon the divestment of its 55% stake in Elektromotive Limited.
Shares in Arion Entertainment closed at 0.1 cent lower, or 10% down, at 0.9 cents on Feb 8.
