Insights Law advises SGX-ST Catalist-listed company, Hengyang Petrochemical Logistics Limited, on the increase in registered capital of its 49%-owned China based joint venture company, by way of (a) a cash subscription and (b) a debt capitalisation, both of which are classified as interested person transactions under Chapter 9 of the SGX-ST’s Catalist Rules

Insights Law LLC has recently advised Singapore Stock Exchange’s Catalist-listed company, Hengyang Petrochemical Logistics Limited (“Hengyang”), on the increase in the registered capital of its 49%-owned joint venture company, Jiangyin Foreversun Chemical Logistics Co., Ltd. (the “China Holdco”) by RMB160 million (or equivalent to approximately S$33.22 million) (the “Increase in Registered Capital”). The total consideration for the Increase in Registered Capital is RMB268.80 million (or equivalent to approximately S$55.80 million).

The Increase in Registered Capital was undertaken through (a) cash injections by two existing shareholders of the China Holdco and by Jiangyin Golden Bridge Chemical Co., Ltd. (“Jinqiao Chemical”), an existing creditor of the China Holdco, which subscribed for new registered capital in the China Holdco accordingly (the “IPT Subscription Exercise”); and (b) a debt capitalisation exercise in which outstanding amounts due from the China Holdco to Jinqiao Chemical were capitalised as equity interest in the China Holdco issued to Jinqiao Chemical (the “Debt Capitalisation Exercise”, and together with the IPT Subscription Exercise, the “IPT Transactions”). The IPT Transactions constitute “interested person transactions” under Rule 904(4) of the Singapore Exchange Securities Trading Limited Listing Manual Section B: Rules of Catalist (the “Catalist Rules”). Relevant announcements and shareholders’ circular on the IPT Transactions have been released via SGXNET on 13 July 2022, 19 August 2022 and 5 September 2022. Insights Law Director Dr. Qiu Yang, assisted by Ms. Ngim Dean Gee and Ms. Vivien Chee, led the advisory team.