mm2 Asia Ltd. has signed an agreement with Kingsmead Properties, a local investment firm, to sell its business for USD 63.14 million. This deal will be subject to approval from shareholders at an extraordinary general meeting, as well as from regulators.
It is to be noted that mm2 Asia Ltd. is a motion picture and video production company that operates movies under the Cathay brand. It was founded by Melvin Ang in 2008 and is headquartered in Singapore.
According to Ang, the cinema business has been a pivotal division of the group’s content creation and distribution business. The coronavirus pandemic has greatly affected the segment, but with the sale agreement, the financial condition of the group is expected to stabilize.
This will allow mm2 Asia to focus on the strengthening and development of core content creation while seeking out more growth opportunities, he claimed.
Notably, Jasmine Foo Mei Ling is the director and sole shareholder of the privately-owned investment firm Kingsmead Properties.
The proceeds from this agreement will be used to pare down the debt of the group, which also includes convertible bonds due on Dec 31, 2021. It is estimated that the company will garner net proceeds of around USD 50.12 million after removing all transaction expenses and costs.
The anticipated loss of approximately USD 63.01 million that will arise from the transaction will showcase the deficit of proceeds over book value, as reflected in the audited consolidated financial statements of the group for the financial year 2021.
According to sources, mm2 Asia had bought eight cinemas of the Cathay brand, in November 2017 across Singapore for USD 171.19 million. These were new additions to the 19 movie theatres that were already operating across the Causeway.