TA Corporation has requested for the voluntary suspension of trading on its shares in the event of participation from shareholders and “clarity” regarding the financials of the company on the 17th of July.
In the same report on SGX the board of directors declared the fact that Tiong Aik Construction (TA Construction) is a wholly-owned company that is a wholly-owned subsidiary of TA Corp, has been placed under liquidation provisional.
Marina View Residences Marina View price came just S$101 above the amount the group had applied for the Marina View Residences to be released on the government’s reserve list.
As per the news release that was made, the management of TA Construction has resolved to select liquidators for provisional purposes after determining the company’s “presently not able to meet its obligations at the time they are due”.
The reason for this is an extreme tightening of cash flow in TA Construction arising from difficulties in the collection of the monies for retention and payments and the rising demands for increased costs and financing to tackle increases in material and labour costs.
In addition, higher interest rates have resulted in more expensive borrowing costs as well as an unfavorable financial environment. Along with a slower utilization of the saleable properties created in the name of TA Corp, this has restricted the amount to which it’s in a position to sustain the cash flow needs of TA Construction and its ability to acquire new projects given its financial situation according to the board.
Examining the consequences of TA Construction’s proviso liquidation and TA Corp’s plan to “engage in a wider and more holistic way” with its noteholders, lenders suppliers, business partners and customers the board has decided that as “prudent” to implement the voluntary suspension of trading on its shares.
TA Corp also has exposure to parent guarantees as well as other forms of financial assistance in support of TA Construction and its projects in addition to the possibility of cross-defaults being caused due to the provisional liquidation of loans made by other subsidiaries.
It has appoint Messrs Deloitte & Touche Financial Advisory Services as its financial advisor, and Messrs Reed Smith Resource Law Alliance as legal advisor to assist in the review of its financial situation and provide advice about the steps that need to be implemented.
Shares of TA Corp last traded at 7.3 cents on the 17th of July prior to its stock market halt the day.