RAFFLESINTERIOR(01376)接获投诉信

Core Viewpoint - Raffles Interior (01376) has received a complaint alleging violations of Chinese foreign exchange regulations related to a proposed acquisition of 100% equity in Kun Yuan Asset Limited for HKD 300 million, which may constitute a significant acquisition and connected transaction [1] Group 1: Allegations and Concerns - The complaint claims that the acquisition involves potential illegal asset transfers out of mainland China and tax evasion by individuals including Zheng Nenghuan and Tang Juding [1] - The target company holds 100% equity in Shenzhen Jin Xuan Technology Co., Ltd., which possesses land use rights for the target assets [1] - The transfer of equity in Shenzhen Jin Xuan to the target company occurred shortly before the acquisition agreement was signed, raising concerns about compliance with Chinese regulations [1] Group 2: Regulatory Compliance Issues - The complaint highlights that the acquisition may violate Chinese foreign exchange regulations, specifically the requirement for foreign exchange registration under the Notice No. 37 [2] - It is alleged that Zheng Nenghuan and/or Tang Juding failed to submit the necessary registration, which could be seen as circumventing foreign exchange controls or illegal cross-border fund transfers [2] - Advancing the acquisition without completing the required registration could lead to violations of Chinese laws and harm minority shareholders' interests [2] Group 3: Corporate Governance and Board Responsibilities - The board is responsible for ensuring compliance with applicable laws and regulations, including full and fair disclosure obligations [3] - Despite the company's intention not to proceed with the acquisition, there has been insufficient disclosure regarding the handling of the sale agreement [3] - The company has sought legal advice regarding the allegations and requested confirmation from Zheng Nenghuan that the pre-acquisition transfer complies with relevant regulations [3] Group 4: Ongoing Investigations and Board Actions - As of the announcement date, Zheng Nenghuan has not provided confirmation or sufficient evidence to refute the allegations in the complaint [4] - The board is awaiting a satisfactory termination agreement for the sale and is concerned about potential significant losses if the acquisition proceeds without compliance [4] - An independent committee has been established to investigate the issues raised in the complaint, with approval from the board [4]