Response to SGX Queries

RESPONSE TO SGX QUERIES::

Issuer & Securities

Issuer/ Manager

THAKRAL CORPORATION LTD

Securities

THAKRAL CORPORATION LTD - SG1AJ2000005 - AWI

Stapled Security

No

Announcement Details

Announcement Title

Response to SGX Queries

Date &Time of Broadcast

27-Jun-2023 18:39:46

Status

New

Supplementary Title

On Other Announcements

Others (Please Specify)

Thakral invests in a 10% stake in the holding company of CurrentBody

Announcement Reference

SG230627OTHR6MZ1

Submitted By (Co./ Ind. Name)

Anil Daryanani

Designation

Chief Financial Offcer

Description (Please provide a detailed description of the change in the box below)

Please refer to attached Reply to SGX queries regarding investment in a 10% stake in the holding company of CurrentBody.

Attachments

ThakralCorp_SGXQuery_CB_20230627.pdf

Total size =105K MB

THAKRAL CORPORATION LTD

(Incorporated in the Republic of Singapore on 7 October 1993)

(Company Registration No. 199306606E)

ANNOUNCEMENT

REPLY TO SGX QUERIES REGARDING

INVESTMENT IN A 10% STAKE IN

THE HOLDING COMPANY OF CURRENTBODY

All capitalised terms not defined herein have the meanings ascribed to them in the Company's Press Release titled "Thakral invests in a 10% stake in the holding company of CurrentBody" on 22 June 2023 (Announcement Reference: SG230622OTHRGNBC) (the "PR").

The Board of Directors (the "Board") of Thakral Corporation Ltd (the "Company", and together with its subsidiaries, the "Group") refers the queries from the Singapore Exchange Regulation Pte Ltd ("SGX") on 23 June 2023 in relation to the PR and appends its response below.

SGX Query 1

For the acquisition of the ordinary shares, preference shares, interest bearing notes, transfer of the shares in CBT, please disclose the following:-

  1. the aggregate value of the consideration, stating the factors taken into account in arriving at it and how it will be satisfied, including the terms of payment; and
  2. in the case of unlisted shares, the net asset value represented by such shares.

Response:

  1. (i) The consideration for the investment is an aggregate amount of S$9.09 million1 (equivalent of GBP5.30 million) ("Consideration"), comprising the following:
    1. S$4.64 million for the issuance and allotment of 2,706,366 C Preference Shares by Glow Topco (being 10% of the total issued preference shares by Glow Topco) to Thakral Lifestyle Pte Ltd ("TLPL"), a wholly owned subsidiary of the Company; and
    2. S$4.45 million for the issuance of loan notes ("Midco Notes") at face value of GBP2.59 million) by Project Glow Midco Limited ("Glow Midco"), which is a wholly owned subsidiary of Glow Topco (being 10% of the total issued loan notes of Glow Midco) to TLPL.

TLPL was also issued and allotted 61,667 B2 Ordinary Shares in Glow Topco at a nominal value, equivalent to an interest of about 9.4% of the

  • All figures in British Sterling have been converted to Singapore Dollars based on an exchange rate of 0.5833:1 as at 20 June 2023.

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Thakral Corporation Ltd

Company Registration No. 199306606E

Reply to SGX Queries on Press Release on 10% investment in holding company of CurrentBody

current issued ordinary shares in Glow Topco2.

    1. The Consideration was satisfied by:
      1. the transfer by TLPL of its 50% shareholding in CBT with net book value of S$1.09 million3;
      2. the transfer by TLPL of loan notes of aggregate face value amounting to S$1.70 million (equivalent of GBP0.99 million) issued by CBT; and
      3. a cash injection of S$3.18 million (equivalent of GBP1.85 million) ("Cash Injection").
  2. The terms of the C Preference Shares are set out in paragraph a in the Response to SGX Query 3. The net asset value of the B2 Ordinary Shares ascribed to it by TLPL is nominal. Notwithstanding that a nominal value is ascribed to the B2 Ordinary Shares, the Board is of the view that the investment is in the best interest of the Group and will bring value to the shareholders. Some of the factors considered by the Board in making this investment are as follows:
    1. CB, which is the operating entity of Glow Topco, has consistently delivered strong performance since its entry into the joint venture with the Group in 2018.
    2. This investment allows the Group to unlock the investment in CBT into a more favorable position to realise its initial investment in CBT in 2018. It would otherwise be difficult for TLPL to divest its 50% shareholding in CBT, which is illiquid due to the nature of the investment.
    3. There are synergies between the position of Glow Topco and its subsidiaries (collectively, the "Glow Group") as a leading player in at- home use beauty and wellness devices and the Group's expertise and recognition as a beauty and wellness brand distributor and retailer player in the Greater China and other Asian markets.

SGX Query 2

What is the amount of "further cash amount" to be invested by Thakral?

Response:

Other than the Cash Injection already made, there is no further amount to be invested by the Company or TLPL.

  • As part of the terms of the investment, ordinary shares were to be issued to certain key management executives in Glow Topco and its operating entities. After the allotment of such shares, TLPL will hold an indirect interest of 9.4% in CBT.
    3 Taking the Consideration less the Cash Injection and the aggregate face value of the loan notes issued by CBT to TLPL, the consideration received by TLPL for its 50% shareholding in CBT is approximately S$4.21 million. As a result of the investment, the Company was therefore able to recognise a profit of S$3.12 million on the transfer by TLPL of the shares in CBT to CB.

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Thakral Corporation Ltd

Company Registration No. 199306606E

Reply to SGX Queries on Press Release on 10% investment in holding company of CurrentBody

SGX Query 3

What are the salient terms of the preference shares and interest bearing notes?

Response:

  1. The C Preference Shares are a class of preference shares in Glow Topco. The salient terms of the C Preference Shares are as follows:
    1. As with other classes of preference shares, holders of C Preference Shares will receive a fixed cumulative dividend at the annual rate of 10% of the principal value per share;
    2. As with other classes of preference shares, the C Preference Shares are redeemable on 26 October 2027;
    3. In addition, holders of C Preference Shares are entitled to payment of S$2.23 million (equivalent of GBP1.30 million) ("C Preference Redemption Sum") pro rata to the number of C Preference Shares held, if:
      1. any of the following events occur:
        1. the completion of any sale of any interest in any shares of Glow Topco (whether in one transaction or a series of related transactions) resulting in the transferee (either alone or together with its connected persons) holding a controlling interest; or
        1. the listing of any shares in Glow Topco (or securities representing such shares) to, or the grant of permission for any such shares (or securities representing such shares) to be listed on a recognised investment exchange; or
        1. a voluntary or involuntary distribution pursuant to a winding-up, dissolution or liquidation of Glow Topco; and
      3. in the reasonable opinion of the board of Glow Topco, the gross revenue of CBT for the 12-month period commencing on 1 January 2023 is equal to or exceeds (i) 105% of the gross revenue for the 12 month period commencing on 1 January 2022 or (ii) RMB 100 million (whichever is lower).

The Company is currently the sole holder of C Preference Shares.

  1. The Midco Notes are constituted by a loan note instrument executed by Glow Midco. The salient terms of the Midco Notes are as follows:
    1. Interest accrues daily at the rate of 10% per annum;
    2. The Midco Notes are to be repaid on the fifth anniversary of the date of the loan note instrument (i.e. 22 June 2023) constituting the Midco Notes that are issued to the Company;

Page 3 of 6

Thakral Corporation Ltd

Company Registration No. 199306606E

Reply to SGX Queries on Press Release on 10% investment in holding company of CurrentBody

  1. The liabilities to be owed by Glow Midco under the Midco Notes rank pari passu with all liabilities owed or to be owed under loan notes constituted by instruments entered into by any entity in the Glow Group from time to time and any redemption amounts payable in respect of any preference shares issued by Glow Topco.

SGX Query 4

Please confirm if the Company will still hold any interest in CBT after the proposed transfer of the 50% stake in CBT.

Response:

The Company will no longer hold any direct shares in CBT through TLPL, which will now be a 100% subsidiary of Glow Topco. The Company will hold an indirect interest of 9.4% in CBT through TLPL's shareholding in Glow Topco.

SGX Query 5

What would be the Group's final interests in Glow Topco?

Response:

The Group's final interest in Glow Topco will be 9.4% after taking into account the allotment of ordinary shares to key management executives in Glow Topco and its operating entities as part of the terms of the investment.

SGX Query 6

How would these interests in Glow Topco be accounted for in the Group's financial statements after the proposed transactions?

Response:

The investment in the C Preference Shares and Midco Notes shall be accounted for as financial assets at amortised cost while the B2 Ordinary Shares shall be accounted for as financial assets at fair value through the Group's income statement.

SGX Query 7

Please disclose the effect of the transaction on the net tangible assets per share of the issuer for the most recently completed financial year, assuming that the transaction had been effected at the end of that financial year.

Response:

The effect of the investment on the net tangible assets per share ("NTA") for the most recently completed financial year, assuming that the investment had been effected at the end of that financial year is as follows:

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Disclaimer

Thakral Corporation Ltd. published this content on 27 June 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 June 2023 11:08:03 UTC.