Embracing Future Holdings Responds to SGX Queries on Major Acquisitions

Embracing Future Holdings Limited (the “Company”) has issued a comprehensive response to the Singapore Exchange Securities Trading Limited’s (SGX-ST) queries regarding its proposed slate of acquisitions in the biomedical, AI education, and media sectors. These transactions, which involve complex cross-border asset purchases valued in aggregate at tens of millions of Singapore dollars, have the potential to significantly reshape the Group’s business profile and financial outlook.

Key Points from the SGX Queries and Company’s Responses

1. Justification of Acquisition Multiples and Valuations

• EFBM Acquisition: The Company is proposing to acquire a 10% stake in EFBM for S\$6.65 million, implying a S\$66.5 million equity valuation for EFBM. This is 10 times the recent acquisition value of its key subsidiary, Cellmex (S\$6.65 million). The Board clarifies that the premium reflects EFBM’s role as a strategic holding platform for future biomedical ventures, Cellmex’s licensing and technology value, and the forward-looking earnings potential. The deal is still subject to independent valuation and due diligence.
• SATPL Acquisition: The S\$6.5 million valuation for SATPL, which holds interests in SH EduTech Co and Astrovator (early-stage companies with limited or negative track record), is justified by the scalability and strategic value of the AI education business, proprietary curriculum, cross-border growth prospects, and upcoming independent valuation.
• BJWL Advertising Acquisition: Despite being newly incorporated with no historical track record, BJWL Advertising is valued at S\$68 million. The rationale is based on its integration with the Group’s MCN (multi-channel network) ecosystem and potential customer contracts, with final fairness dependent on independent valuation.
• EFMCN Acquisition: Acquiring the remaining 49% of EFMCN for S\$104,000, despite EFMCN’s net loss and negative tangible assets, is justified as enabling full control and integration of the MCN business, with the price considered modest and subject to further scrutiny.

2. Use of Independent Valuations as a Safeguard

• All acquisition prices were negotiated on a commercial basis and are conditional upon satisfactory due diligence, independent valuation reports, and IFA opinions.
• Completion conditions include shareholders’ approval at an EGM. Any material mismatch between final independent valuations and agreed prices will trigger potential renegotiation or enhanced disclosure.

3. Issue Price of Consideration Shares

• Discrepancy in Share Issue Prices: There are two different issue prices for consideration shares:
  • S\$0.10 per share for independent third-party vendors (Mr. Katsuki and Ms. Zhou Jun) for EFBM and SATPL acquisitions.
  • S\$0.065 per share for interested persons (Mr. Zhu Hua and BJZHAT) in the BJWL and EFMCN acquisitions.

  The Company explains that this difference is due to commercial negotiations, transaction structure, and counterparty willingness, not preferential treatment.

4. Due Diligence and Financial Disclosure

• The Company and its Sponsor are still conducting due diligence, including legal, financial, and commercial assessments. Full details and independent valuations will be provided in the upcoming shareholder circular.
• Some acquisition targets do not yet have meaningful standalone financials, so profit attribution for the purposes of Catalist Rule 1006(b) is based on underlying operating subsidiaries’ results.
• The Company was unable to provide full pro forma financial effects at announcement due to ongoing verification of key inputs, including share allotment numbers and final equity interests acquired.

5. Governance and Safeguards for Shareholders

• All transactions are subject to shareholder approval and completion of due diligence and independent valuation.
• If independent valuations differ substantially from agreed prices, the Company will consider renegotiation or provide enhanced disclosures to ensure shareholders are fully informed.
• Any potential interested person transactions have been carefully reviewed for compliance with Catalist Rules.

Price-Sensitive and Potentially Share Price Moving Information

• Major Strategic Shift: The Group is transitioning into biomedical, AI-education, and digital media/MCN business lines, with large equity stakes in newly established or early-stage companies at high implied valuations. This marks a major shift in business focus and risk profile.
• Share Dilution Risk: All acquisitions are to be settled by new share issuances, potentially leading to significant dilution for existing shareholders.
• Valuation Uncertainty: Final acquisition prices may change if independent valuations differ significantly from negotiated terms, introducing deal uncertainty.
• Key Management and Control: The independence and experience of new major shareholders and executives (such as Ms. Zhou Jun and Mr. Katsuki) and the integration of newly-formed businesses is critical and may impact future performance.
• Risk of Overpayment: As several targets are newly incorporated or loss-making, there is a risk the Company may overpay if future growth does not materialise as expected.

Other Notable Details for Shareholders

• Introducers’ Role: Even though some acquisition targets are linked to the Company’s own directors, third-party introducers were involved in cross-border matching and deal structuring.
• Ms. Zhou Jun’s Role: Founder and key executive of both SH EduTech Co (PRC) and Astrovator (Singapore), Ms. Zhou Jun will provide strategic leadership with local teams handling day-to-day operations.
• Due Diligence Timeline: Due diligence began in early December 2025 and remains ongoing, with further details to be disclosed before shareholder voting.

Investor Takeaways

These proposed acquisitions represent a transformative and high-risk expansion for Embracing Future Holdings. They entail a shift into new industries, significant share dilution, and valuation uncertainties. Shareholders should closely monitor the upcoming independent valuation results, due diligence findings, and final terms of the deals, as these will be critical in assessing the ultimate impact on shareholder value and the Company’s strategic direction.

Shareholders are urged to read the forthcoming circular and attend the EGM to vote on these significant transactions, as their approval is required for completion.

Disclaimer: This article is based on official disclosures by Embracing Future Holdings Limited as of 20 January 2026 and is for informational purposes only. It does not constitute investment advice. Investors should consult the Company’s official announcements, circulars, and seek professional advice before making investment decisions. The information herein is subject to change upon further disclosures by the Company.

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