SunMoon Food Company says it is exploring various fund-raising options and is now in talks with a "potential investor on a specific funding option", following news that the parent company of its controlling shareholder is in bankruptcy reorganisation.
The company, which operates foodstuff supply chains, has also set up an executive committee to look into the bankruptcy reorganisation of Shanghai Yiguo E-Commerce, Shanghai Winchain Supply Chain Management and Shanghai Exfresh Logistics.
See: SunMoon Food parent Shanghai Yiguo files for bankruptcy, putting $12.4 mil worth of receivables at risk and SunMoon's Loh sells shares ahead of parent company's bankruptcy filing announcement
SunMoon on Oct 12 disclosed that the companies, collectively known as the three Yiguo entities, were placed into voluntary bankruptcy reorganisation under Chinese law back in July 30, 2020.
However, in its Oct 17 follow up announcement, SunMoon clarified that it has found, through its Chinese counsel, that the entities were placed into involuntary bankruptcy reorganisation by their creditors instead.
Shanghai Yiguo is the parent company of SunMoon Food’s controlling shareholder. It is the ultimate holding company of Yiguo General Food, which, in turn, holds 59.9% of SunMoon Food.
In an SGX filing, the company said its executive committee had created and implemented a framework to work with the current management team “to ensure that the business operations of the company continue to operate” and to reduce the impact of the recent announcements on the company’s business operations.
Shares in SunMoon Food last traded at 3.1 cents on Oct 12. Trading suspension has been called.
