Mercurius Capital Investment Limited – December 2025 Monthly Update: Key Developments and Financial Position

Key Highlights from the Report

• Negotiations with Creditors: No material developments regarding the notice of demand from Songmart’s liquidator; Company in verbal agreement with investors to extend maturity of key loans pending RTO completion.
• Grand Bay Hotel Co., Ltd. (GBH) Status: Liquidation put on hold; exploring a capital reduction exercise as an alternative exit strategy.
• Delay in Audited Financials: Audits for FY2023 and FY2024 remain incomplete due to outstanding audit fees, delaying AGMs for both years.
• RTO Plan & Potential Delisting: Deadline to sign definitive RTO agreement has lapsed; Company must consider voluntary delisting as required by SGX-ST approval conditions.
• Financial Position: Minimal cash balance and ongoing high liabilities; net liabilities stand at S\$9.009 million (excluding JV), S\$3.064 million (including JV).
• Working Capital: Approval to use THB 25 million (approx. S\$1 million) for working capital, conditional on RTO plan progress.

Detailed Developments and Issues for Shareholders

1. Status of Creditors and Loan Repayments

The Company has not received further communications from Songmart’s liquidator regarding stamp duty liabilities or Songmart’s liquidation. Importantly, the Company has reached a verbal understanding with the investors of three key convertible loans (all due in June 2025) and a US\$460,000 loan from Asia Assets Development Co. Ltd. (due July 2025) to extend their maturity dates until the proposed reverse takeover (RTO) is completed. This extension is critical to avoid immediate repayment pressure and preserve operational stability.

2. Grand Bay Hotel Co., Ltd. (GBH) – Change in Exit Strategy

The previously proposed liquidation of GBH has been suspended. The Company is now actively exploring a capital reduction exercise as an alternative exit strategy. Legal discussions are ongoing, and no final decision has been made. This change in strategy could impact the Group’s asset base and future cash flows, depending on the outcome of negotiations and legal review.

3. Audit and Financial Reporting Delays

The completion of audited financial statements for FY2023 is pending settlement of outstanding audit fees. This delay has a domino effect: until FY2023 is completed, FY2024’s audit cannot proceed, and neither AGM for those years can be convened. Such continued delays in statutory reporting could undermine investor confidence, regulatory compliance, and potentially affect the Company’s listing status.

4. RTO Plan and Possible Delisting Risk

The Company had previously secured SGX-ST’s approval to use THB 25 million (approx. S\$1 million) from proposed liquidation funds for working capital, contingent on signing a definitive RTO agreement by 31 December 2025. As this deadline has passed without an agreement, the Company is now required to consider a voluntary delisting. This is a major development: failure to execute an RTO or secure a new path forward may result in the Company’s shares being delisted, severely impacting share value and investor interests.

5. Financial Position as at 31 December 2025

The Company’s financial position remains precarious:

• Assets (excluding JV): S\$139,000
• Liabilities: Trade and other payables S\$2.952 million, Borrowings S\$6.196 million
• Net Liabilities (excluding JV): S\$9.009 million
• Net Liabilities (including JV investment of S\$5.945 million): S\$3.064 million
• Cash Balance: Only S\$1,000 at month-end (virtually unchanged from start of December)

The Company’s asset base is largely illiquid, and its liabilities are significant. This precarious balance sheet, coupled with ongoing delays in financial reporting and the risk of delisting, presents a clear and present risk to shareholders.

Shareholder Implications and Price-Sensitive Issues

• Potential Delisting: If the Company cannot secure a definitive RTO deal or another alternative, there is a real risk of delisting which would be highly detrimental to share value and liquidity.
• Delayed Audited Results: The inability to complete audits and hold AGMs for two consecutive years further endangers compliance and investor confidence.
• Creditor Negotiations: While loan extensions have been verbally agreed, these are not formalized, and failure to complete the RTO may trigger repayment demands.
• Critical Working Capital Situation: With only S\$1,000 in cash and heavy reliance on borrowed funds (including director advances), the Company’s ability to operate as a going concern is under threat.

Conclusion

This update contains several material developments that could significantly affect Mercurius Capital Investment Limited’s share price and future as a listed entity. Investors must closely monitor the Company’s ability to finalize its RTO, resolve audit delays, and strengthen its financial position. The possibility of a delisting is now a key threat that could have a substantial negative impact on shareholder value.

Disclaimer

This article is for informational purposes only and does not constitute financial advice or an offer to buy or sell any securities. Investors should conduct their own due diligence and consult professional advisors before making investment decisions. The information herein is based on the Company’s official announcements as of the date referenced and may be subject to change.

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