Catalist-listed Starburst Holdings' executive chairman Edward Lim Chin Wah and managing director Yap Tin Foo are on bail amid an investigation by the Corrupt Practices Investigation Bureau (CPIB).
According to the company's exchange filing on Sunday night, the two men were interviewed by the CPIB last Thursday in connection with Starburst Engineering, a wholly owned subsidiary.
Between the start of trading on Nov 12 and its close on Nov 13, Starburst's share price dropped by three cents to 37.5 cents.
Yesterday, the stock was the Singapore market's biggest decliner, plunging 65 per cent to 13.1 cents.
CPIB also interviewed the company's chief financial officer Wu Guangyi and senior project manager Josiah Lawrence Ng Eng Long, according to the filing. Mr Ng is also currently on bail.
Starburst said in its filing that the investigations are "not related to the current projects of the group" and do not affect its business and operations. "The board is unable to provide further details at this time as the CPIB's investigation is ongoing," it added.
The company also said the board is of the view that Mr Lim, Mr Yap and Mr Ng, who recused themselves, should continue with their respective responsibilities and duties "to ensure business continuity". The board will "reassess its position where appropriate in due course", it said.
The company, which is headquartered in Singapore, specialises in the design and engineering of firearms training facilities. Its customers include law enforcement, military and security agencies as well as the civil authorities in South-east Asia and the Middle East.
In March, the company announced that Starburst Engineering had clinched the group's largest order to date - a $40.9 million contract to build a firearms training facility in South-east Asia, scheduled to be completed by February 2022.
In August, Mr Lim and Mr Yap, who are Starburst Holdings' controlling shareholders, each sold 3.2 million shares, or a total 2.6 per cent stake in the company, to a group of investors at 39 cents.
The shares were sold at a discount of 7.9 per cent to Starburst's then one-day volume-weighted average price of 42.34 cents.
Mr Lim and Mr Yap hold 35.81 per cent and 33.86 per cent, respectively, of the company's shares, The Edge Singapore reported, citing a Nov 5 note by UOB Kay Hian.
In its latest business update last month, Starburst Holdings reported a third-quarter net profit of $2.1 million, reversing from a net loss of $692,000 for the year-ago period. Group revenue in the three months to Sept 30 jumped 80.5 per cent to $4.8 million, from $2.6 million a year ago.
This was mainly due to the start of design work for a firearms shooting range project and a tactical training mock-up project in South-east Asia, and design and fabrication work for a firearms shooting range project in the Middle East, the company said.