Pine Capital unit sues 2 ex-directors for breach of duties, conspiracy

SINGAPORE - Advance Capital Partners Asset Management (ACPAM), a subsidiary of Catalist-listed Pine Capital Group, has commenced legal proceedings against two former directors.

ACPAM is alleging that Wang Meng and Pan Ki Ro had breached their common law, statutory and fiduciary duties and obligations owed to ACPAM, and had conspired to injure ACPAM by unlawful means, according to Pine Capital's bourse filing late Monday night (Oct 15).

Mr Wang, 30, had been ACPAM's chief executive officer and director before he was removed at an extraordinary general meeting (EGM) on Aug 12 by the firm's only two shareholders, Pine Capital and Tan Choon Wee, ACPAM's former interim CEO and chairman. Mr Pan was also removed as an ACPAM director during the EGM.

Subsequently, Mr Wang also stepped down as Pine Capital's head of Greater China on Aug 19. In his exit interview, he had expressed concerns about the financial positions of ACPAM and Pine Capital's Shanghai consulting arm.

The management rights of the only fund managed by ACPAM, Advance Credit Fund SPC (ACF), rests with the holder of ACF's one management share, said Pine Capital on Tuesday.

ACPAM's legal proceedings against Mr Wang and Mr Pan relate to possible mismanagement and the transfer of the one management share in ACF from ACPAM to Mr Wang.

This transfer was made with the approval of Mr Pan, to the best of Pine Capital's board's knowledge.

As a result of the transfer, ACPAM - the principal fund and a contributor to Pine Capital's revenue and earnings - has no other operating fund.

Mr Wang had been one of the two directors of ACF, with the other director being Alauddin Ahmed.

As part of these legal proceedings, ACPAM has also obtained an interim injunction from the Singapore High Court against Mr Wang and Mr Pan.

The injunction restrains them from transferring, disposing or otherwise dealing with the one management share in ACF; acting or purporting to act as ACF's directors, and acting on ACF's behalf or interfering in the affairs of ACF; exercising any rights as the holder of the one management share; and disposing of, transferring and/or dealing with any of ACF's assets or properties.

The court also ordered Mr Wang and Mr Pan to provide a full account of all dealings and transactions carried out by ACF since April 2019.

Pine Capital and its legal advisers are "closely monitoring" the progress of the legal proceedings against both individuals and will update shareholders of further developments, the filing stated.

Pine Capital said the transfer of the ACF management share will not have a material impact on the company's earnings per share (EPS) and net tangible assets per share for the current financial year.

While there will be loss of revenue from ACF, the fund was a loss-making activity, and after removing associated costs the net effect on the group's EPS will be positive but immaterial, Pine Capital noted.

Aside from ACPAM, Pine Capital still has an operating business through its consulting arm in China - Pine Capital (Shanghai) Group - which has a team working to secure mandates and partnership sales agreements.

Last week, the Singapore Exchange queried Pine Capital on its decision to add two Hong Kong-based directors to its board, David Sarkis and Chan Wai Leung.

Trading in the company's shares has been suspended since March.

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