Cordlife to cancel private placement; MOH highlights importance of having Singapore-based directors

SINGAPORE - Cordlife on May 13 said that it intends to terminate the

$8.2 million private placement

announced on April 17.

This comes after the High Court upheld an interim injunction that restrains the company from issuing new shares temporarily and dismissed its appeal to overturn it.

Controlling shareholder Nanjing Xinjiekou Department Store, as well as non-independent non-executive directors Zhai Lingyun and Chen Xiaoling, filed an injunction application against the company, its acting chairman Ho Choon Hou, independent directors Yeo Hwee Tiong and Titus Cheong, non-independent non-executive directors Yiu Ming Yiu and Chow Wai Leong, and group chief executive Ivan Yiu Pang Fai.

Pending the hearing on this application, an interim injunction was granted by the High Court on April 19. On April 25, the company filed an application to set aside the interim injunction, which was, however, dismissed on May 10.

Separately on May 13, the troubled cord blood bank said that the Ministry of Health (MOH) had issued it a notice highlighting the importance of having Singapore-based directors ahead of its May 14 annual general meeting (AGM) that will decide whether three local directors will be replaced amid a shareholder tussle.

MOH said Cordlife’s board should provide sufficient oversight and directions to its local management and laboratory operations teams.

The new board should also respond expediently to MOH’s queries and ensure business continuity while rectifying its lapses, the ministry added.

As the new board should ensure a smooth and proper transition, particularly in relation to all outstanding regulatory matters, a relevant factor given the company’s present circumstances would be whether the board members will be present in Singapore, said MOH.

Substantial shareholder Nanjing Xinjiekou wants to remove four directors – acting chairman, Dr Ho, and independent directors, Mr Yeo, Mr Cheong and Mr Joseph Wong. Mr Wong has said he will retire after the AGM.

Nanjing Xinjiekou also seeks to appoint three new directors – Dr Teo Tong Kooi, Dr Xu Tianhong and Mr Cai Yong – to replace the three Singapore-based directors, Dr Ho, Mr Yeo and Mr Cheong.

In the latest development, duelling shareholder TransGlobal Real Estate Group sent an open letter to other shareholders on May 13 asserting that Nanjing Xinjiekou’s nominee directors, Mr Zhai Lingyun and Ms Chen Xiaoling, “have failed to deal with Cordlife’s outstanding Singapore matters in person”. It also said that none of Nanjing Xinjiekou’s proposed directors is based in Singapore. 

TransGlobal said its letter was in response to one

sent out by Nanjing Xinjiekou on May 9

which made “numerous assertions in an attempt to justify their intended reconstitution of the board”.

Shares of Cordlife closed 0.2 cent, or 1.59 per cent, higher at 12.8 cents on May 13.

THE BUSINESS TIMES

With additional information from The Straits Times