SGX RegCo has issued a trade with caution alert on Yinda Infocomm, whose shares have climbed 181% to 14.9 cents on March 30 from 5.3 cents on Sept 24 2020. In contrast, the Straits Times Index gained 30.2% in the same period.
The warning from the market regulator was issued just ahead of the company’s EGM to be held on March 31 for shareholders to approve the diversification of its business and the proposed acquisition.
Between last Sept and Jan, SGX RegCo notes five key corporate actions YIL announced where the volume weighted average price of its shares was integral to the transactions
On Sept 29 2020, Yinda Infocomm announced a proposed placement of 76 million new ordinary shares at 5 cents, a discount compared to the volume weighted average price of 5.3 cents on Sept 24 2020 used in the Sept 29 2020 announcement.
On Nov 15 2020, the company announced a proposed placement of 81.2 million new ordinary shares at 7.2 cents, a discount compared to the volume weighted average price of 7.96 cents on Nov 11 2020 used in the Nov 15 2020 announcement.
On Dec 13 2020, the company announced a proposed placement of 41.3 million new ordinary shares at 7.7 cents, a discount compared to the volume weighted average price of 8.03 cents on Dec 9 2020 used in the Dec 13 2020 announcement
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On Jan 26 2021, the company announced a proposed placement of 167.4 million new ordinary shares at 12.5 cents, a discount compared to the volume weighted average price of 13.67 cents on Jan 21 2021 used in the Jan 26 2021 announcement.
On the same day, Yinda Infocomm announced the proposed acquisition of 51% shareholding in the total ordinary share capital of International Biometrics, which provides identity management biometrics technology.
A total of 143.333 million consideration shares will be issued and allotted at an issue price of 15 cents -- a premium compared to the volume weighted average price of 13.67 cents on Jan 21 2021 used in the Jan 26 2021 announcement.
According to Yinda Infocomm, the placements proceeds were meant for working capital and new business opportunities, including the diversification into biometrics via the acquisition of International Biometrics.
SGX RegCo observed that the same person acted as the introducer in all five of these announcements. The person wasn’t named by SGX but in the company’s previous filings, the introducer was a Hong Kong entity called Precious Glory Enterprises whose directors are one Tan Chin Tuan and Li Jingjing.
SGX RegCo’s review of the trades in Yinda Infocomm shares further showed that a group of accounts appeared to be influencing the share prices of the company.
“Our initial findings suggest the individuals behind these accounts are likely connected to the introducer,” SGX RegCo says.
Yinda Infocomm shares closed on March 30 at 14.9 cents, up 6.43% for the day.
