Advance Capital Partners Asset Management (ACPAM), a unit of Catalist-listed Pine Capital Group, has started legal proceedings against two former directors.
It alleges that Mr Wang Meng and Mr Pan Ki Ro breached their common law, statutory and fiduciary duties and obligations, and conspired to injure the company by unlawful means, according to a Pine Capital's bourse filing late on Monday night.
Mr Wang, 30, was ACPAM's chief executive and director before being removed at an extraordinary general meeting (EGM) on Aug 12 by the firm's only two shareholders - Pine Capital and Mr Tan Choon Wee, ACPAM's former interim CEO and chairman. Mr Pan was also removed as an ACPAM director.
Mr Wang stepped down as Pine Capital's head of Greater China on Aug 19, expressing 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), rest with the holder of ACF's one management share, said Pine Capital yesterday.
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 the Pine Capital board's knowledge.
As a result, ACPAM - the principal fund and a contributor to Pine Capital's revenue and earnings - has no other operating fund.
Pine Capital said the transfer of the ACF management share will not have a material impact on its earnings per share and net tangible assets per share for this financial year. There will be loss of revenue from ACF, which was a loss-making activity, Pine Capital noted.
Mr Wang had been one of the two directors of ACF.
ACPAM has obtained an interim injunction from the Singapore High Court against Mr Wang and Mr Pan.
This restrains them from transferring, disposing or otherwise dealing with the one management share in ACF, among other curbs related to the fund.
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 this year.
Pine Capital said the transfer of the ACF management share will not have a material impact on its earnings per share and net tangible assets per share for this financial year.
There will be loss of revenue from ACF, which was a loss-making activity, Pine Capital noted.
Aside from ACPAM, Pine Capital has an operating business through its consulting arm in China that is working to secure mandates and partnership sales agreements.
Last week, the Singapore Exchange queried Pine Capital on its move to add two Hong Kong-based directors to its board.
Trading in the firm's shares was suspended in March.