Stratech in early talks with possible investors

Dr David Chew, founder and executive chairman of Stratech Group.
Dr David Chew, founder and executive chairman of Stratech Group. PHOTO: BUSINESS TIMES

Cash-strapped Stratech Group said it has "had preliminary discussions with certain parties" keen on investing in the company.

It added that it will also expedite an injection of fresh funds from its controlling shareholders - flagged in February this year - as part of efforts to raise more cash to keep the company going.

In an exchange filing yesterday, the surveillance solutions provider said it was in a negative net equity position as at March 31.

Stratech said it had liabilities such as short-term loans and other payables, which include operational costs such as trade payables, fees, accrued payroll expenses and Central Provident Fund contributions.

Some of these payables have since become due, the company said.

The Stratech Group had earlier proposed to undertake a rights issue of up to 313,436,340 new shares, in which the founders and controlling shareholders David Chew and Leong Sook Ching committed to injecting about $9 million of fresh funds and a further $2 million to $3 million of existing loans to the company to address its cashflow and going concern issues.

In view of the current cashflow requirements, the controlling shareholders have agreed to expedite injection of the fresh funds as loans in advance pending the rights issue exercise, the company said in its exchange filing.

The company also said it plans to resolve any loan defaults, payroll issues including amounts due for Central Provident Fund contributions, within the next two weeks.

It has made applications to the Accounting and Corporate Regulatory Authority and the Singapore Exchange for extensions till the end of next month to hold its annual general meeting as well as issue its annual report.

A version of this article appeared in the print edition of The Straits Times on August 08, 2017, with the headline 'Stratech in early talks with possible investors'. Print Edition | Subscribe