Catalist-listed Hatten Land has, on Nov 1, established a joint venture company (JVC) with HydraX to jointly develop and operate ‘first-of-its-kind’ cryptocurrency exchanges (crypto exchanges) in Singapore and Malaysia.
The move is the latest initiative by Hatten Land to re-purpose its malls in Melaka and align its business model with the growth trends of the digital economy.
The crypto exchanges will list and trade eco-friendly Bitcoin wrapper tokens, newly minted Bitcoins and, or other tokens.
The joint venture agreement (JVA) was signed by Hatten Land’s wholly-owned subsidiary Hatten Technology.
According to Hatten Land, the crypto exchanges and related custodian services are subject to the JVC obtaining the necessary regulatory approvals in both countries.
The crypto exchanges are believed to be the first such exchanges around the world.
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In addition to operating the exchanges, the JVC will also generate revenue by providing custody services for the cryptocurrencies and tokens that are being traded.
Under the terms of the JVA, Hatten Technology will hold 60% of the shares in the JVC, while Hydra X will hold the remaining 40%.
See: Hatten Land partners with blockchain launchpad EnjinStarter to digitise assets, create NFTs
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It will also provide US$500,000 ($673,950) as initial working capital for the JVC in the form of a loan. The amount will be capitalised or repaid on terms that are mutually agreed by both parties.
As partial consideration for the development costs, Hydra X will be issued a total of 8.989 million shares for a total value of US$400,000 at the price of 6 cents per share. The issue price represents a discount of around 2.12% to the volume weighted average price (VWAP) of 6.13 cents based on trades done on the SGX-ST from Oct 27, up to the trading halt on Oct 28.
The shares will be issued in two tranches.
The first tranche amounts to some 4,494,666 shares equivalent to US$200,000, which will be issued to Hydra X within four weeks of the company commencing work under the services agreement.
The second tranche of 4,494,667 shares equivalent to another US$200,000, will be issued within four weeks of Hydra X conducting the UAT installation of the technology in connection with the digital assets.
The issuance of the shares is subject to approval from the SGX-ST.
Should the approvals not be obtained, the consideration will be paid in cash instead.
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Hydra X is a homegrown company that is primarily in the business of providing regulatory-compliant, enterprise-ready financial infrastructure for institutional clients.
Headquartered in Singapore, Hydra X has a management team that comes with a total of 60 years of experience in finance, financial regulation, law and technology.
Its customers include financial institutions like DBS. It also provides custody services for digital securities under the FinTech Regulatory Sandbox of the Monetary Authority of Singapore (MAS).
As at Nov 1, Hydra X has an issued and paid-up share capital of $191 over 10,000,001 ordinary shares, as well as US$6.5 million divided into 3,518,556 ordinary shares.
Its three largest shareholders are Sigma Value, Hydra X CEO Daryl Low Junrui and Hydra X Digital Technologies.
For just four months till Nov last year, Low was an independent director at Axington, which is linked to the scandal-plagued Loh cousins.
Proposed share placement to tech-focused investor
In the same statement, Hatten Land announced that it has proposed to issue 20 million new ordinary shares at 6 cents apiece to Golden Summit International.
Golden Summit invests in consumer and enterprise tech companies in Southeast Asia, North Asia and North America.
Its investments include Coupang, the largest online marketplace in South Korae, as well as Stockbit, a popular Indonesian stock trading app.
In the proposed placement of the new shares, 70% of the net proceeds will be used to fund new business initiatives by Hatten Land. The rest will be used for working capital.
Commenting on the news, Dato’ Colin Tan, executive chairman and managing director of Hatten Land says, “This joint venture to develop and operate crypto exchanges is strategic to our digital and blockchain initiatives. The listing and trading of digital assets will significantly enhance the value proposition of our strategic pivot towards the digital economy.”
“While cryptocurrencies are becoming mainstream, we foresee a growing demand for ‘virgin’ and “green” Bitcoins amid the rising ESG trend and we look forward to harness the opportunities in this area,” Tan adds.
“This initiative is a step towards fulfilling Hydra X’s aim to help catalyse institutional adoption of digital assets. We look forward to a fruitful partnership with Hatten Land to enable global trading in the digital capital markets space while playing a part in promoting environmental sustainability by addressing concerns of socially conscious investors,” says Hydra X’s CEO Low.
Shares in Hatten Land last traded at 5.9 cents on Oct 28 after a trading halt was issued.
Photo: Hatten Land
