ASIA-PACIFIC STRATEGIC INVESTMENTS LIMITED (Incorporated in the Republic of Singapore) (Company Registration No. 200609901H) PROPOSED ACQUISITION OF SHARES IN THE CAPITAL OF IPC CORPORATION LIMITED OWNED BY OEI HONG LEONG, NGIAM MIA JE PATRICK, NGIAM MIA HONG ALFRED, NGIAM MIA KIAT BENJAMIN, LAUW HUI KIAN, ESSEX INVESTMENTS (S) PTE LTD AND THEIR NOMINEES - UPDATE ANNOUNCEMENT 1. INTRODUCTION The Board of Directors (the Board ) of Asia-Pacific Strategic Investments Limited (the Company ) refers to the announcements dated 31 January 2018 and 1 March 2018 (the Previous Announcements ) in respect of the Proposed Acquisition. Capitalised terms not defined herein shall bear the same meaning ascribed to them in the Previous Announcements. 2. ACCEPTANCE OF WITHDRAWAL The Board wishes to announce that it has sought legal advice in response to Mr Oei Hong Leong s withdrawal of his acceptance of the Letter of Offer in relation to the Company s acquisition of 28,111,320 ordinary shares in the capital of the Target ( Target Shares ) which was announced on 1 March 2018 (the Withdrawal ). After taking into account preliminary legal advice obtained by the Company, as well as after due deliberation and consideration, the Board has decided that it will accept the Withdrawal and not proceed with the Company s acquisition of 28,111,320 Target Shares from Mr Oei Hong Leong. The Company is continuing to seek professional advice in relation to the resultant implications of the Withdrawal and will provide further updates as and when material developments concerning the above arise. 3. NO MANDATORY OFFER TO BE MADE The Company s obligation to purchase 11,894,084 Target Shares from Ngiam Mia Je Patrick, Ngiam Mia Hong Alfred, Ngiam Kiat Benjamin, Lauw Hui Kian, Essex Investments (S) Pte Ltd and their nominees (the Remaining Vendors ) pursuant to the Letter of Offer still remains and the Company intends to proceed with the acquisition of such shares (the Remaining Acquisition ). Assuming completion of the Remaining Acquisition occurs, the Company will own or control 11,894,084 Target Shares representing approximately 13.95% of the share capital of the Target. As such, the Company will not be required to make a mandatory offer for the remaining Target Shares in accordance with Section 139 of the Securities and Futures Act, Chapter 289 of Singapore and Rule 14 of the Code. In light of the Board s decision to accept the Withdrawal, the Company will not be making a mandatory offer for the remaining Target Shares in accordance with Section 1
139 of the Securities and Futures Act, Chapter 289 of Singapore and Rule 14 of the Code. 4. CHAPTER 10 DISCLOSURES IN RELATION TO THE REMAINING ACQUISITION In light of the Withdrawal, the Company sets out the information required to be disclosed pursuant to Chapter 10 Part VI of the Catalist Rules in respect of the Remaining Acquisition. 4.1. Particulars of the assets being acquired and description of the trade carried on Pursuant to the Remaining Acquisition, the Company shall purchase 11,894,084 Target Shares from the Remaining Vendors, representing approximately 13.95% of the share capital of the Target (the Remaining Sale Shares ). The Target was incorporated in Singapore on 8 May 1985 and has been listed on the Main Board of the SGX-ST since 21 May 1993. Its businesses include property investment and development as well as investment holding. The Target Group has in 2008/09 expanded its property business, from a pure property developer and beyond China, into the following three core areas: (a) Invest in and provide consultation for property development projects in tier two cities in China; (b) Develop new residential projects, as well as buying and selling of residential properties, especially in Japan; and (c) Invest in income producing properties, in particular business hotels in Japan and business/boutiques in China. 4.2. Consideration and Source of Funds The consideration for the Remaining Acquisition shall be satisfied by the allotment and issuance of 1,581,913,172 new ordinary shares in the capital of the Company (the Remaining Consideration Shares ) based on the agreed ratio of exchange of 133 Remaining Consideration Shares for every one Remaining Sale Share. The consideration was agreed to on a willing-buyer willing-seller basis, taking into account the potential future synergies of the Target with the Company s business operations especially with regard to real estate opportunities in China. The Remaining Consideration Shares represent approximately 13.55% of the existing total number of issued and paid-up ordinary shares in the share capital of the Company as at the date of the announcement of the Letter of Offer (being 31 January 2018) and as at the date of this announcement, and approximately 12.24% of the enlarged share capital of the Company 1. The issue price for each Remaining Consideration Share shall be S$0.00332 which is the volume weighted average price ( VWAP ) of the ordinary shares of the Company (the Shares ) transacted on the Catalist of the SGX-ST on 26 January 2018, being the full day of trading of the Shares immediately prior to the date of the announcement of the Letter of Offer (such date being 31 January 2018). The Remaining Consideration Shares, when allotted and issued, shall rank pari passu in all respects with the then existing Shares as at the date of their issue, save that they will not rank for any dividends, rights, allotments or other distributions, the record date of which falls on or before the date of their issue. 1 For the purposes of this announcement, the enlarged share capital of the Company comprises 12,925,733,877 ordinary shares. Such enlarged share capital does not contemplate the exercise of the Company s 12,286,324,559 warrants which are unexercised and outstanding as at the date of this announcement. 2
4.3. Material conditions The Remaining Acquisition is conditional upon the following conditions being fulfilled or waived (the Remaining Conditions Precedent ): (a) The Company receiving shareholders approval for the Remaining Acquisition and the issue of the Remaining Consideration Shares to the Remaining Vendors; and (b) The Company receiving the approval-in-principle from the SGX-ST for the dealing in, listing and quotation of the Remaining Consideration Shares. The long-stop date for the fulfilment of the Remaining Conditions Precedent is the date falling three months after the date of the Letter of Offer or such later date as the Company and the Remaining Vendors may agree in writing (the Remaining Long-Stop Date ). If the Remaining Conditions Precedent are not fulfilled by the Remaining Long-Stop Date, the Letter of Offer shall ipo facto cease and determine and none of the parties shall have any claim against the others for costs, damages, compensation or otherwise. As the Remaining Acquisition constitutes a Discloseable Transaction under Chapter 10 of the Catalist Rules (refer to paragraph 4.9 of this announcement), the Company will not require shareholders approval for the Remaining Acquisition. Also, as the Remaining Consideration Shares shall be issued and allotted pursuant to the general share issue mandate to issue new Shares passed by the shareholders at the Company s annual general meeting held on 30 October 2017, the Company will not require shareholders approval for the issue of the Remaining Consideration Shares to the Remaining Vendors. The Company will be submitting an application to the Sponsor for the listing and quotation of the Remaining Consideration Shares on the Catalist of the SGX-ST. The Company will make the necessary announcements once the approval-in-principle for the dealing in, listing and quotation of the Remaining Consideration Shares has been obtained from the SGX-ST. 4.4. Value of the assets being acquired The book value of the Remaining Sale Shares is the same as the net tangible asset value which is S$11,530,000 based on the Target s latest unaudited financial statements for the financial year ended 31 December 2017. The net loss attributable to the Remaining Sale Shares is S$665,000 based on the Target s latest unaudited financial statements for the financial year ended 31 December 2017. The market value of the Remaining Sale Shares is S$4,923,000 based on the VWAP of the Target Shares transacted on the Main Board of the SGX-ST on 26 January 2018, being the full day of trading of the Target Shares immediately preceding the date of the Letter of Offer (such date being 29 January 2018). 4.5. Financial effects (a) Net tangible assets ( NTA ) per Share For illustrative purposes only and assuming that the Remaining Acquisition had been completed on 30 June 2017, being the end of the most recently concluded financial year, being the financial year ended 30 June 2017 ( FY2017 ), the proforma financial effects of the consolidated NTA of the Company and its subsidiaries (the Group ) will be as follows: Before completion of the Remaining Acquisition After completion of the Remaining Acquisition Consolidated NTA attributable to the 26,792 33,120 3
shareholders of the Company (S$ 000) Number of Shares (excluding treasury shares) ( 000) Consolidated NTA per Share attributable to the shareholders of the Company (S$) 3,892,650 5,474,563 0.007 0.006 (b) Earnings per Share ( EPS ) For illustrative purposes only and assuming that the Remaining Acquisition had been completed on 1 July 2016, being the start of FY2017, the proforma financial effects on the consolidated EPS of the Group will be as follows: Before completion of the Remaining Acquisition After completion of the Remaining Acquisition Loss attributable to the shareholders of the Company (S$ 000) Weighted average number of Shares (excluding treasury shares) ( 000) (6,588) (6,588) 3,891,487 5,473,400 4.6. Rationale Consolidated EPS (S$) (0.002) (0.001) The Target Group has a portfolio of assets which include investment assets that generate steady income. The Remaining Acquisition is being undertaken by the Group as part of its investments in income generating assets, and is in line with the investment objectives of the Company. 4.7. Interest of directors or controlling shareholders Dato Dr Choo Yeow Ming is an independent director of the Target as well as the Chairman and Chief Executive Officer of the Company. Save as disclosed, none of the directors or controlling shareholders of the Company has any interest, direct or indirect, in the Remaining Acquisition (other than through their respective shareholdings in the Company, if any). 4.8. Service contracts No person is proposed to be appointed as a director of the Company in connection with the Remaining Acquisition and there are no service contracts that will be entered into with any directors in connection with the Remaining Acquisition. 4.9. Rule 1006 relative figures Based on the latest unaudited financial statements of the Group for the 3 month period ended 30 September 2017 and the Target Group s unaudited financial statements for the 3 month period ended 31 December 2017 (1), the relative figures for the Remaining Acquisition computed on the bases set out in Rule 1006 of the Catalist Rules are as follows: Rule 1006(a) Net value of the assets to be disposed of Net asset value of the Group Size of relative figure 4
Rule 1006(b) Net loss attributable to the acquired assets (S$155,000) Net loss of the Group for the three months (S$1,528,000) ended 30 September 2017 Size of relative figure 10.1% Rule 1006(c) Aggregate value of consideration to be S$6,327,653 given (2) Company s market capitalization as at 26 S$38,770,833 January 2018 (3), being the last traded market day immediately preceding the date of the Letter of Offer Size of relative figure 16.3% Rule 1006(d) Number of equity securities to be issued by 1,581,913,172 the Company as consideration for an acquisition Number of equity securities in issue (5) 11,667,961,622 Size of relative figure 13.6% Rule 1006(e) Aggregate volume or amount of proven and probable reserves to be disposed of Aggregate of the Group s proven and probable reserves Size of relative figure Notes: (1) The Group and the Target Group do not have corresponding reporting periods and the comparative figures are based on the latest announced figures of the Group and the Target Group respectively as at the date of the announcement of the Letter of Offer, and the Target Group s financials are pro-rated to the percentage of Remaining Sale Shares being acquired. (2) Under Rule 1003(3) of the Catalist Rules, where the consideration is in the form of shares, the value of the consideration shall be determined by reference either to the market value of such shares or the net asset value represented by such shares, whichever is higher. As such, for the purpose of Rule 1006(c) of the Catalist Rules, the consideration for the Remaining Acquisition is deemed to be S$6,327,653, which is the net asset value represented by the Remaining Consideration Shares based on the latest unaudited financial statements of the Group for the 3 month period ended 30 September 2017. (3) The market capitalisation of S$38,770,833 is derived from the VWAP of S$0.00332 per Share as at 26 January 2018, being the last traded market day immediately preceding the date of the Letter of Offer (Source: Bloomberg) and the issued share capital of 11,677,961,622 Shares. The Board notes that the relative figures computed on the bases set out in Rule 1006(a) to (e) of the Catalist Rules exceed 5% but do not exceed 75%. Accordingly, the Remaining Acquisition constitutes a Discloseable Transaction as defined under Chapter 10 of the Catalist Rules. As the consideration for the Remaining Acquisition is to be satisfied wholly in securities for which listing is being sought, the Company has also made the Chapter 10 Part IV disclosures in accordance with Rule 1009 of the Catalist Rules. 4.10. Documents for inspection 5
A copy of the Letter of Offer is available for inspection at the office of the Company at 1 Scotts Road, #20-07 Shaw Centre, Singapore 228208 during normal business hours for a period of three months commencing from the date of the announcement of the Letter of Offer. 5. TRADING CAUTION Shareholders are advised to exercise caution in trading their Shares. The Remaining Acquisition is subject to numerous conditions. There is no certainty or assurance as at the date of this Announcement that the Remaining Acquisition will be completed or that no changes will be made to the terms thereof. The Company will make the necessary announcements when there are further developments. Shareholders are advised to read this announcement and any further announcements by the Company carefully. Shareholders and potential investors are reminded to exercise caution when dealing in the securities of the Company and should consult their stockbroker, bank managers, solicitor or other professional advisers if they have any doubt about the actions that they should take. BY ORDER OF THE BOARD Dato Dr Choo Yeow Ming Chairman and Chief Executive Officer 5 March 2018 This announcement has been prepared by the Company and its contents have been reviewed by the Company s sponsor, Stamford Corporate Services Pte Ltd (the Sponsor ), for compliance with the relevant rules of the Singapore Exchange Securities Trading Limited (the SGX-ST ) only. The Sponsor has not independently verified the contents of this announcement. This announcement has not been examined or approved by the SGX-ST and the SGX-ST assumes no responsibility for the contents of this announcement, including the correctness of any of the statements or opinions made or reports contained in this announcement. The contact person for the Sponsor is Mr. Ng Joo Khin. Telephone number: 6389 3000. Email: jookhin.ng@morganlewis.com 6