Datapulse Technology

[Millionfaith]

More drama. Clarifications that seems to provide more ammo for the opposing shareholders. It was obvious that the update was directed at the open letter released by Ascapia Capital Private Limited. The CEO having to resign because of pre-existing illness aggravated by recent development in the company. I would laugh if a man's health isn't in peril.

SG Announcement: RESIGNATION OF CEO AND APPOINTMENT OF INTERIM CEO 

SG Announcement:  GENERAL UPDATE ANNOUNCEMENT

The problem with the new update is that while some of what the board is trying to explain is true, it does nothing to deflect criticisms that the acquisition was done in haste, without proper due diligence and worse of all, appears to be carried out to enrich associates of the controlling shareholder. And realistically, the issue of the company becoming a cash company really isn't that urgent as the update makes it out to be.

This was the single worse paragraph in the statement released: "In view of the foregoing, to question the bona fide of the Board’s decision based on the sole factor of the high multiple based on historical profits represented by the purchase consideration amount may be incomplete and misleading." 

Be that as it may, the update does not adequately explain why Wayco deserved such high multiples. Have any of you heard of any of Wayco products namely  “GoodLook” and “Glorin” line of hair products? If you goggled for it the packaging may look vaguely familiar but I doubt many used the products.

Another thing that might have been easily overlooked by many is that the company really thinks that the average retail shareholder is gullible enough to believe the "risks" of becoming a cash company. There is no risk there. We have seen time after time again that there are handful companies listed on SGX that are cash companies and has ample time to be allowed to look for companies. The company is trying very hard to justify its hasty decision but shareholders need to look past the smokescreen.

Delist is not a bad option, better than acquiring companies without doing proper due diligence. Frankly with the current board, it would be better to delist than diworisification. The purchase price of Wayco is way above valuation, and I do not see growth potential for its product lines. The brand "Goodlook" and "Glorin" have been around for decades, one of the cheapest brand of hair products.