SINGAPORE (Dec 21): Innopac Holding CEO and chairman Wong Chin Yong will resign from the company effective Mar 31, 2019, as part of a deal that is likely to see a new group of shareholders taking control. With immediate effect, Wong will also step down as chairman of the board of directors.
In a filing to SGX on Oct 9, Innopac said it had found new investors willing to subscribe to 8.4 billion new shares at 0.1 cent each to raise gross proceeds of $8.4 million.
In conjunction with the new investments, Wong will also buy over a clutch of Innopac subsidiaries that owe money to creditor Saxo Bank for $100,000.
Together, these subsidiaries carry a negative book value of around $8.3 million, as of June 30. This means Wong is paying a premium of 1,012% over the book value of these companies. The listed company can then book a gain on disposal of some $8.4 million.
Pursuant to the terms of the sale and purchase agreement, Innopac said Wong will terminate his employment with the company.
In addition, Innopac said staff working as directors and management staff in the subsidiaries to be sold – Heritage Investment Corporation (HIC), Wang Da Investment (WDIL), Golden Eagle Mining (GEM), Extera (EPL) and Malaysian Microalgae Enterprise (MME) – will also resign from their offices in the entities.
See: Innopac selling 8.4 billion new shares to investors; plans to cut loose troubled units
Apart from Wong, Innopac announced late Friday that independent non-executive director Dato Moehamad Izat has resigned with immediate effect “due to his advanced age and other work commitments”.
The 80-year-old, who has been on the Innopac board since Nov 1995, was also its nominating committee chairman and remuneration committee chairman.
Independent non-executive director Arslan Koichiev, 53, will also resign with immediate effect “due to his own work commitments”. Koichiev was also a member of Innopac’s nomination and remuneration committees
Another independent non-executive director, Ong Kah Hock, has also expressed his desire to resign from the board. Ong, who is also a member of the audit, nominating and remuneration committees, will step down by Mar 20, 2019. Innopac says Ong has agreed to stay on the board until the company has a minimum of three independent directors in compliance with the SGX listing rules.
In November, Innopac agreed to engage a valuer to assess the businesses to be sold to Wong at a steep discount to their potential net tangible value, after the Singapore Exchange raised queries over the interested person transaction.
See: Innopac to engage valuer on businesses it plans to dispose after further queries by SGX
SGX in October rejected Innopac’s application to resume trading of its shares, which has been in this suspended since June this year.
Innopac is one of the companies linked to John Soh Chee Wen, the alleged mastermind behind the 2015 penny stock crash. He was managing director of the company, which was previously known as Inno-Pacific Holdings, between 1995 and 1999.
Soh, who is currently facing 189 charges ranging from witness tampering to fraud, has been held in remand since Nov 2016.
