SINGAPORE – Former Cathay cinema operator mm2 Asia’s proposed rescue investor has received regulatory approval to potentially take control of the troubled entertainment company without having to offer to buy out its other shareholders.
The Securities Industry Council (SIC) has waived the requirement for MMRA to make a mandatory general offer after subscribing for up to 16.34 billion new shares in the company, mm2 Asia said in a bourse filing on Sept 22.
MMRA is a subsidiary of Hildrics Asia Growth Fund, a private equity fund that provides growth capital to mid-tier South-east Asian companies. The fund is managed by Hildrics Capital, whose chief executive Choo Kee Siong is a former managing director at UOB. Its chief operating officer Wee Teng Chuen is the son of UOB chief executive Wee Ee Cheong.
The proposed placement, announced in July, is expected to raise around $15 million and forms part of mm2 Asia’s broader debt restructuring.
Should the placement go through, MMRA could emerge with more than 49 per cent of mm2 Asia’s voting rights and subsequently acquire more shares without triggering a mandatory general offer.
Of the placement proceeds, $11.5 million, or 76.7 per cent, is earmarked for debt repayment, mm2 said in a July 16 filing first disclosing the placement.
The remaining $3.5 million will be used for general working capital and restructuring expenses. These include payments to key suppliers and service providers, outstanding statutory obligations and the completion of outstanding audits, as well as listing, application and professional fees related to the restructuring.
mm2 Asia said the placement is part of its efforts to address its financial difficulties and restore the group’s viability as a going concern.
It described MMRA as a “white knight” providing the financial support needed to carry out the restructuring.
The placement is expected to strengthen mm2 Asia’s capital base, improve its working capital position and provide funding for the exercise. Without it, the company said it would face significant uncertainty over its ability to implement a viable restructuring plan.
MMRA will subscribe for the shares at 0.0918 cent each, a discount of about 69.4 per cent to mm2 Asia’s last traded price of 0.3 cent before its shares were suspended in November 2025, mm2 Asia said in July
The placement shares represent about 250 per cent of mm2 Asia’s existing share capital and, if issued in full, would account for about 71.4 per cent of its enlarged share capital before other parts of the restructuring are considered.
Under Singapore’s takeover rules, an investor crossing certain ownership thresholds would normally have to make an offer for all the remaining shares.
The SIC waiver removes this requirement, but it will take effect only if mm2 Asia’s independent shareholders approve.
mm2 Asia must also appoint an independent financial adviser to assess the proposal and advise independent shareholders.
It also has to share details about the proposed restructuring, including the placement as well as the dilution that existing shareholders could face.
Shareholder approval for the waiver must be obtained within three months of the SIC’s Sept 18 letter. The placement shares must then be issued within three months of that approval.
The waiver clears another hurdle for mm2 Asia’s proposed restructuring, after the High Court on Sept 18 allowed the company and its subsidiary mm2 Entertainment to convene creditor meetings to vote on their debt repayment plans.
The court also extended a moratorium shielding the companies from creditors and legal proceedings by two months to Nov 21, giving them more time to complete the restructuring process.
