SINGAPORE – A proposed restructuring scheme for the former operator of Cathay Cineplexes, mm2 Asia (mm2A), and its subsidiary mm2 Entertainment (mm2E) has been approved, the group said in a bourse filing on Nov 5.
The media production house said the majority of its creditors gave the green light for the proposed restructuring for both entities, and that it would now seek court sanction for the schemes.
To proceed, the schemes had required a majority representing three-quarters of the value of the debt in each class of creditors.
The total value of debt for mm2A was around $221.3 million among Class A to F creditors, and that for mm2E was $152.5 million among Class A to C creditors.
In both cases, almost all the creditor classes were 100% in favour of the schemes, except for a minority in mm2A’s Class E creditors and mm2E’s Class C creditors.
Subject to court sanction
The group will proceed with the proposed scheme of arrangement, subject to obtaining court sanction as described under the part of the Companies Act that governs procedures between companies and their creditors and/or shareholders.
Shares of mm2A have been suspended from trading since Nov 11, 2025. The group has been under moratoria – recently extended to Nov 21, 2026 – meaning that it has court protection against creditor claims while it sorts out the restructuring.
The scheme of arrangement involves, among other things, a proposed placement to raise $15 million for repaying creditors, a debt-to-equity swap, disposal of the group’s shareholding in a related entity, and disposal of the Cathay intellectual property (IP).
Some of these moves were previously announced by mm2A in March.
The proposed placement involves the issue of 16,339,110,825 new shares to MMRA at $0.000918 each, raising around $15 million.
MMRA, a private limited subsidiary of private equity fund Hildrics Asia Growth Fund, received approval from the Securities Industry Council in September for a takeover of mm2A without having to offer to buy out its other shareholders.
MMRA will use $11.5 million to repay creditors, and the balance for working capital and restructuring expenses.
After the proposed placement, the group plans a non-renounceable, non-underwritten rights issue of up to 6.2 billion new shares to entitled shareholders at $0.00161 each, on the basis of four new shares for every 21 shares held.
Besides raising funds, the rights issue allows shareholders to participate in recapitalisation and maintain their ownership percentage.
For the debt-to-equity swop, mm2A will issue 9,803,466,495 new shares to specific creditors of mm2A and mm2E, pro rata, in partial repayment of debts.
The company also plans to dispose of 138.7 million ordinary shares it holds in Vividthree Holdings to “the relevant secured creditor” in full and final settlement of its secured claim.
It also proposes to sell the IP rights to Cathay Cineplexes to another creditor, which was not named, as full settlement of its claim under an unsecured loan note dated Nov 4, 2024.
Court documents show that mm2A issued $15 million in loan notes to Linkwasha Holdings (a company related to the Cathay Organisation) in November 2024. Linkwasha loaned $30 million to mm2A in 2017 to help finance the acquisition of Cathay Cineplexes; in 2025, it issued a statutory demand for repayment of the $7.5 million remaining on the loan.
Shares of mm2 Asia last closed at $0.003. THE BUSINESS TIMES
