CATALYST-listed restaurant operator No Signboard Holdings : 1G6 0% has entered into a non-binding memorandum of understanding (MOU) to receive up to S$5 million in investments from renewable biomass project developer and operator Gazelle Ventures. Under the proposed investment, Gazelle Ventures will also hold a 75 per cent stake in the enlarged share capital of No Signboard through a S$500,000 subscription of new shares.

 

The remaining S$4,500,000 will be invested by way of a debt or equity instrument. This will be for working capital purposes including but not be limited to the settlement of professional, advisory and success fees on such terms and conditions as may be agreed between the companies,   No Signboard said in a bourse filing on Sunday (May 1).

 

Gazelle Ventures will also provide S$450,000 of &ldquo rescue financing&rdquo which is &ldquo subject to the satisfaction of the necessary conditions as agreed between the investor and the company&rdquo , the seafood restaurant chain said.

 

Gazelle Ventures is a Singapore-incorporated company jointly owned by Gazelle Capital and Valiant Investments. It invests in food, agri-tech and sustainable agriculture-related businesses.

 

In March, No Signboard announced that it would be shutting its Esplanade outlet to reduce costs as the outlet was making losses.

 

" The closure of the No Signboard Seafood Esplanade outlet will allow the group to focus its efforts and resources on operating the group' s casual and quick-serve restaurant outlets until further review of the evolving Covid-19 situation," the company had said.

  After two years battling the economic impact of the Covid-19 pandemic, seafood restaurant owner No Signboard closed its Esplanade outlet on Friday (April 1), just as Singapore reopened its borders.

 

No Signboard said it had carefully considered the option of keeping the outlet open until all Covid-19 restrictions were fully lifted.

 

However, it may take several more months before travel returns to levels before the pandemic hit, even though the Government had recently eased restrictions, such as increasing the maximum group size for dine-ins from five to 10, the company said.

 

This will continue to adversely affect the business of No Signboard' s Esplanade outlet, it said in a filing on the Singapore Exchange late on Thursday night.

 

Hence, its board believes that closing the outlet to reduce operating costs would be in the best interests of the company in the light of its current financial situation.

 

No Signboard will continue to operate its other restaurant outlets, namely Little Sheep Hotpot at Orchard Gateway and No Signboard Sheng Jian at Northpoint City.

 

" The closure of the No Signboard Seafood Esplanade outlet will allow the group to focus its efforts and resources on operating the group' s casual and quick-serve restaurant outlets until further review of the evolving Covid-19 situation," said the company.

 

Given that the Esplanade outlet is making losses, it said the closure is expected to contribute positively to its consolidated net tangible assets and earnings per share for the current financial year ending on Sept 30 this year.

CATALIST-LISTED No Signboard Holdings said on Monday (Mar 14) that it will be placing its indirect wholly-owned subsidiary, Danish Breweries, into creditors' voluntary liquidation (CVL).

 

In a bourse filing, the restaurant operator said the subsidiary cannot continue its business by reason of its liabilities. It said: " The group has decided to proceed with the CVL of the subsidiary due to its cash flow problems and its inability to pay its debts as they fall due."

 

Danish Breweries was acquired by the group in June 2017 and is engaged in the business of the import, export and general wholesale trading of beer and liquor.

 

As the subsidiary is loss making, the voluntary liquidation is expected to " contribute positively" to the net tangible assets and earnings per share of the group for the current financial year ending Sept 2022, No Signboard said.

 

No Signboard shares last traded at S$0.031 in January, before a voluntary trading suspension was requested, as the company was not able to demonstrate that it is able to continue as a going concern.

RESTAURANT operator No Signboard Holdings' controlling shareholder GuGong has entered into a second conditional sale and purchase agreement on Friday (Mar 11) to sell a 22 per cent stake in the company to private investor Bryan Lim Soon Fang for S$1.

 

As a condition to the completion of the proposed share transfer, Lim will extend an interest-free unsecured loan of an aggregate principal amount of S$1.9 million.

 

Earlier this week, the company had entered into a separate deal with Q& M Dental' s chief executive Ng Chin Siau. Under the agreement, Ng will take a 29 per cent stake in No Signboard for S$1.

 

There was also an agreement for Ng to extend an interest-free unsecured loan of S$2.6 million to the company as a condition for the completion of the proposed share transfer.

 

GuGong currently holds around 54.9 per cent of the total issued shares in the company.

 

The 2 loans expected to be granted by Lim and Ng will allow the company to obtain a total of S$4.5 million in interest-free and unsecured financing, which is expected to assist in meeting the group' s working capital requirements, said No Signboard in its bourse filing.

 

The 2 deals are separate and not inter-conditional upon each other, noted the company.

 

The proposed share transfer is subject to approval being obtained from the Singapore Exchange as the shares of No Signboard are suspended.

 

Other conditions include that the total net liabilities of the group - excluding costs and expenses incurred in connection with the proposed share transfer and its restructuring exercise - does not exceed S$4.5 million.

 

IN response to queries from the SGX Regulation (SGX RegCo), No Signboard Holdings said the move to enter into a deal with Q& M Dental' s chief executive Ng Chin Siau is intended to form a key part of the company' s trading resumption proposal.

 

In a bourse filing on Thursday (Mar 10), the restaurant operator said that it, along with its controlling shareholder GuGong, is currently focused on finalising agreements with Ng and investors to raise the financing the group requires to address its going concern issues.

 

In the event that No Signboard is unable to enter into the loan agreements with Ng and other investors to raise the necessary financing, it will then move to discuss other alternatives with its financial adviser, said the company.

 

On Mar 7, it was announced that Ng had entered into a sale and purchase agreement (SPA) to take a 29 per cent stake in No Signboard for a total consideration of S$1. There was also an agreement for Ng to extend an interest-free unsecured loan of S$2.6 million to the company as a condition for the completion of the proposed share transfer.

 

GuGong, which currently holds a 54.9 per cent stake in No Signboard, has the company' s chief executive Lim Yong Sim, and chief operating officer Lim Lay Hoon as shareholders and directors. Following the share transfer, GuGong' s stake will fall to just 25.9 per cent.

 

Both Lim Yong Sim and Lim Lay Hoon will remain in their current positions after the share transfer, said No Signboard.

 

In its response to the bourse regulator' s queries, No Signboard said the disbursement of the S$2.6 million loan will be conditional upon the company and GuGong being able to secure additional financing to resolve the group' s going concern issues.

 

The company currently expects to receive the funds following the approval of its trading resumption proposal and completion of the proposed share transfer.

 

When asked to explain how the consideration of S$1 for a 29 per cent stake was arrived at, No Signboard said the loan agreement would provide the company with " a substantial infusion of interest-free and unsecured funding" to assist with its working capital needs, especially since it sounded a warning on Jan 24 that it is unable to demonstrate the ability to continue as a going concern.

 

In response to SGX RegCo' s query on how the company intends to comply with the requirements of the Catalist rules, No Signboard said it is aware of the listing rules and will detail its plans and milestones in its trading resumption proposal which will be submitted to SGX RegCo upon the execution of the relevant agreements with investors.

 

No Signboard and the company are currently in " advanced negotiation" with investors to secure additional funding to meet working capital needs, and intend to " agree on the terms of the loan agreements with the respective investors" which will form part of the trading resumption proposal, said the company.

 

SGX RegCo also asked No Signboard to elaborate on Ng' s plans for the company, as well as whether he or his nominees will be appointed to the board of directors or key management positions.

 

No Signboard said there is no agreement for Ng or his nominees to be appointed to such positions, and that it is committed to focusing on its existing businesses and expects the demand for these businesses to improve with the gradual easing of Covid-19-related restrictions such as travel and dining-related ones.

 

The firm said it may explore new areas of opportunities should the opportunity arise to increase its revenue streams, although it has not identified or begun any negotiations on such opportunities.

 

Ng' s plans, said the company, are " consistent" with those of the company, adding that Ng' s " main motivation" for entering into the share transfer is to " revive an iconic Singapore brand" .