SINGAPORE: No Signboard Holdings said on Thursday (May 2) that its chief executive officer Lim Yong Sim was arrested earlier this week by local authorities and has been released on bail.
The arrest on Apr 30 was made on “reasonable suspicion” that sections of the Securities and Futures Act on false trading, market-rigging transactions and insider trading “may have been breached”, the Catalist-listed seafood restaurant operator said in a filing to the Singapore Exchange (SGX).
Mr Lim has not been charged for any offence, the company filing added.
The restaurant chain, known for its signature white pepper crab dish, is being investigated by the Commercial Affairs Department (CAD) for an abortive share buyback dated Jan 31.
According to earlier SGX filings, Mr Lim had on Jan 31 instructed the company’s broker, UOB Kay Hian, to queue for the purchase of the company’s own shares at a price of up to S$0.14, after getting approval from shareholders at the annual general meeting held on the same day.
This price exceeded the regulatory limit on share buyback prices and saw the company’s stock surge nearly 24 per cent, prompting a query from SGX.
In its reply to the bourse operator on Feb 3, No Signboard explained that the move was “an honest mistake on the part of Mr Lim as he did not notice that the share purchase at prices of up to S$0.14 exceeded the 5 per cent cap above the average closing price of the last five days permitted under the share buyback mandate of S$0.1226 as at Jan 31, 2019”.
The share purchase was also done during a “black-out period” – a restriction period for dealing in the company’s securities – as No Signboard had not held audit committee and board meetings to approve its first-quarter results.
“In light of the above, the share purchase has inadvertently resulted in two breaches … dealing in the shares of the company during the black-out period and the purchase of shares at a price which exceeded the share price cap,” the company had said.
Subsequently on Apr 29, No Signboard said it was requested by the CAD to assist in investigations.
From Apr 24 to 26, it provided the CAD with access to and copies of documents in connection with the abortive share buyback. No files, records or equipment belonging to the company were seized, it added.
CAD also obtained statements from the company’s CEO and chief financial officer Voon Sze Yin. The former had his passport retained by the CAD – a move that the company described as a requirement during investigations.
In the latest filing on Thursday, the company clarified that copies of the documents in connection with the abortive share buyback were provided to the CAD pursuant to Section 35 of the Criminal Procedure Code.
“The board would like to reiterate that the business and operations of the company will not be affected and will continue as usual,” it said.
“The company will continue to cooperate fully with the CAD in the investigations.”
Shares of No Signboard on the secondary Catalist board were last seen 2.4 per cent lower at S$0.083 on Thursday afternoon.