Last Friday (4th), mm2 All Asia announced that it plans to privately allocate new shares to raise about 14 million yuan, of which 7.5 million yuan is used to repay debts and 6.5 million yuan is used as working capital. The minimum selling price of this batch of new shares is RMB 0.008 per share, and the number of new shares issued may reach 1.875 billion, accounting for 22.3% of the total expanded share capital.
In addition, in order to repay debts, mm2 Quanya plans to sell 21.02% of the equity of listed media production company Vividthree to a private equity fund at the end of May, with a selling price of 1.734 cents per share; the net asset value of this part of the equity is approximately RMB 1.89 million.
According to the statement, Linkwasha is an affiliated entity of Cathay Organisation, the former shareholder of Cathay Cinema. When mm2 Quanya acquired Cathay Cinema for 230 million yuan in cash in 2017, Linkwasha provided a loan of 30 million yuan.
mm2A issued a statement before the market opening on Wednesday (July 9) saying that the company received a statutory debt collection letter from a lawyer representative of Linkwasha Holdings on Monday (7th), requiring the payment of the principal and interest 7.55 million yuan owed within three weeks from the date of delivery, or provide guarantees or settlements for the arrears in a reasonably acceptable manner by Linkwasha.
Under the impact of the coronavirus epidemic, Cathay Cinema's theater business is weak and the rent-bearing crisis has begun to show signs when mm2 All Asia released its first half of fiscal year 2025 in November 2024, showing that revenue fell by 32.1% year-on-year, it may have begun to show signs.
According to mm2 Quanya's previous disclosure, Cathay Cinema's cumulative rent arrears has reached 10.26 million yuan, of which about 3.07 million yuan is guaranteed by the parent company.
As of around 10:21 am on Wednesday, the share price of mm2 Asia has fallen by 14.29% to 0.006 yuan.
mm2Quanya said that the company has continued to repay Linkwasha in recent years due to challenges in the theater business after the COVID-19 pandemic and the acquisition has caused a heavy debt burden. Currently, the company is seeking legal advice on the statutory debt collection letter and plans to contact Linkwasha to explore all feasible options and promote multiple fundraising plans.
By early February 2025, mm2 All Asia issued a statement saying that Cathay Pacific Cinema received a letter of debt-owed rent and the rent-owed rent-owed storm began to break out. At that time, Cathay Pacific Cinema was required to pay the rent and attorney fees arrears at Tampines Century Plaza and Woodlands Changdifang, with a total amount of nearly 2.7 million yuan. Later, Cathay Cinema, at the Jem Shopping Center in Jurong East, was closed due to the owed rent of RMB 4.32 million, and the owner terminated the lease early.
Last Wednesday (2nd), mm2 Quanya stated that Cathay Pacific Cinema received a statutory debt collection letter from the owner's lawyer representative, demanding that 3.44 million yuan be paid by July 22, otherwise it will be deemed to be unable to repay the debt. The debt collector is DBS Trustee, the trustee of Lendlease Global Commercial REIT, the former is the owner of the Jem shopping center in Jurong East.
If mm2 Asia fails to fulfill its repayment requirements, the company will be deemed to be unable to repay its debts under the Insolvency, Restructuring and Dissolution Act of 2018.
The storm of 10 million yuan in rent arrears ofThe storm of owing tens of millions of yuan in owing rent in
is becoming increasingly serious. mm2 Asia (mm2 Asia, referred to as "mm2 Asia") cannot escape the impact and is now in debt.