Yoo-hoo! YuuZoo, anybody home??

Following the vacating of its flagship Singapore office without settling the rent, no answers to who is running the show at the social commerce company, and if it is still solvent

Singapore

A WEEK after YuuZoo Network Groups Corp announced the shutting down of its Singapore operations and the departure of its chief executive, the question remains: Who is running the show at the social commerce company, and is it still solvent?

Finding someone at the company who can provide answers is a challenge. The company's past few Singapore Exchange (SGX) filings listed former chief executive Mohandas as a non-executive director and as a point of contact. But Mr Mohandas, who quit on March 5, has told The Business Times that he had not accepted any redesignated role at the company.

When contacted by BT, an SGX spokesman said it "remains in engagement" with the company. However, it is unable to divulge further details as its engagements with listed companies are confidential, said the spokesman.

It is not clear who investors are supposed to get information from if the company's stated point of contact says he is not the company's spokesman. With Mr Mohandas' departure, YuuZoo now has yet another major management gap to fill. Former chief financial officer Kevin Wang left on April 4, 2018.

BT tried reaching the three directors left on YuuZoo's board. Non-executive chairman and independent director Anthony Williams, a lawyer at Dentons in New York, did not respond to e-mails. Independent director Christopher Cheong declined to comment on the record after BT reached him on the phone. Newly appointed independent director Su Chun Keat also declined to comment when contacted, explaining that he "just joined and (was) in the process of understanding the situation".

One of the most pressing questions surrounding YuuZoo is whether the group is still solvent.

On March 18, BT reported that YuuZoo had vacated its flagship Singapore office at Teletech Park in Science Park without settling its rent.

Mr Mohandas, in a resignation letter that he showed to BT, said he had not received his salary for December 2018 and January and February 2019. The company has said it shut down all of its operations in Singapore amid an inability to pay salaries.

It is not clear if the unpaid bills and salaries are confined to the Singapore operations of Yuu-Zoo, which said in October 2018 that it was splitting its corporate head-quarters between Singapore and Thailand.

Boardroom Corporate & Advisory Services, which was named as the listed company's share transfer agent in its 2017 annual report, declined to comment when asked if it was still providing services for YuuZoo or if it had been paid.

YuuZoo could use some cash. As at Dec 31, 2018, the company had unaudited negative working capital of S$15.7 million, with S$18.3 million of current liabilities against just S$2.6 million of current assets.

The company burned through S$1.3 million of net cash from operations in the fourth quarter of 2018, and S$3.2 million in all of 2018.

Total liabilities included S$9.6 million from YuuZoo's French unit YuuLogistic France, which is under judicial administration. The company said in February that it nevertheless expects to be able to meet its current liabilities due to funds from additional investments.

Shortly after announcing the shutdown of its Singapore operations, YuuZoo said it had secured a commitment for a three-year, S$30 million funding facility from "Swiss-based" Asia Financial Group.

The equity facility will allow YuuZoo to draw down up to S$30 million by issuing YuuZoo shares to the financer at a 7.5 per cent discount to the closing price of YuuZoo stock on the drawdown date.

But it is unclear how, when and if YuuZoo will be able to tap this commitment, given that its stock has been under an exchange-imposed suspension since 2018 and there is still no visibility on when trading might resume. YuuZoo did not provide details about Asia Financial Group.

The company is also part of an investigation by the Commercial Affairs Department, which confirmed to BT that its probe is "ongoing".

That investigation was referred by SGX, which has said it will lift the suspension on YuuZoo's stock when it is satisfied the company's shares can be traded on a fair, orderly and transparent basis.