SINGAPORE (Apt 15): Kelvin Kwok Ying Choy, a substantial shareholder of Acesian Partners, has sold more than 22.5 million of his shares to Loh Yih, who is among the company’s larger shareholders.
The off-market transaction was made on April 5. Loh paid Kwok $337,694.34, which translates into 1.5 cents a share. With this, Loh holds a direct stake of more than 76.8 million shares, or 15.41%, up from 10.89%.
Besides his direct stake, Loh has a deemed stake of more than 47.4 million shares, or 9.52% of the company. The bulk, or 47.38 million, of Loh’s deemed shares are held via an entity called Cavangh Group. His wife holds another 64,600 shares. Loh now has a total direct and deemed stake of nearly 124.3 million shares in the company, or 24.93%.
After the sale of the 22.5 million shares, Kwok has ceased to be a substantial shareholder of Acesian Partners, which is in a variety of businesses such as manufacturing and engineering. Via a nominee, Kwok now owns just over 11.3 million shares, or 2.27%. He used to hold nearly 33.9 million shares, or 6.79%. In a March 1, 2018 announcement, Kwok was said to have subscribed to just over 30 million new Acesian shares at 1.7 cents each. He is known to have invested in other listed companies such as Oceanus Group.
Loh, on the other hand, was previously Acesian Partners’ executive chairman. He took the position in 2013 and was redesignated as managing director from Aug 17, 2018. Neo Gim Kiong, previously an independent director of the company, was appointed non-executive chairman in his stead. Wong Kok Chye, who was previously group CEO, was redesignated as chief operating officer.
The April 5 transaction was made at 1.5 cents, a significant discount to Acesian’s last traded price of two cents on April 3. At this level, Acesian has a market value of $9.97 million and is priced at 8.33 times historical earnings. Year to date, Acesian shares have gained 11.11%. Its net asset value as at Dec 31, 2018 was 2.65 cents a share, down from 2.72 cents a share as at Dec 31, 2017.
Over the past few years, Acesian Partners has been dogged by disputes and lawsuits involving Takenaka Corp. One of its subsidiary companies was a subcontractor for the Japanese company for contracts awarded for Changi Airport Terminals 1 and 4. The subsidiary has been placed under judicial management. The judicial managers, meanwhile, are in their own dispute with Acesian over fees.
For FY2018 ended Dec 31, 2018, the company posted earnings of $1.12 million, reversing losses of $2.42 million in FY2017. Revenue increased 70.6% to $20.5 million between FY2017 and FY2018. The higher turnover was driven by better performance from its manufacturing operations, which doubled its revenue during the year to $7.1 million.
During the year, Acesian booked a provision of $700,000 for judicial management fees. The judicial managers are claiming $900,000. The dispute is now before the courts.
Acesian’s bottom line for FY2017 was hit badly by an impairment of $7.8 million made for the Changi Airport contracts. The dispute with Takenaka is ongoing and “the outcome cannot be predicted with certainty,” says Acesian in its earnings announcement on Feb 27.
Besides an improved bottom line, Acesian reported better cash balances too. As at Dec 31, 2018, it had cash and cash equivalents of $6 million, up from $2.9 million as at Dec 31, 2017. The company attributes the increase to $1.9 million in positive cash flow operating activities.
