News

Epicentre’s CEO MIA With Debts; Seeking Legal Advice On Next Move

2019-06-01 , 6:00 pm

Stress is inevitable but where do we draw the line?

According to Business Insider, Singaporeans (92%) have the highest stress levels at work in comparison with the global average (84%), with reference to a Survey published by health service company Cigna on 26 March 2019, Tuesday.

Ever wanted to disappear without a trace, and escape the stress of school and work in Singapore?

I’m quite certain most of us have entertained that thought but #responsibilities won’t let us follow our heart. The bills aren’t gonna pay themselves, are they?

However, it’s a different story if you’re a CEO and have access to a sustainable amount of cash flow.

That’s what happened to Epicentre Holdings executive chairman and acting chief executive officer, Kenneth Lim Tiong Hian, who took “disappear without a trace” very literally.

Epicentre acting CEO beyond reach for one week

According to Straits Times, Mr Lim has been unreachable since 24 May, Friday. That’s exactly one week ago.

News of Lim’s disappearance was brought to light by Epicentre on 30 May, Thursday, after the company requested for trading to be put on hold.

It was also mentioned that “Epicentre will not be proceeding with a proposed placement of up to about 79.7 million new ordinary shares in its capital” since Mr Lim is indispensable in making decisions for the proposed placement. Furthermore, the company “does not have any monies held in escrow.”

With reference to Escrow.com, an escrow is a financial arrangement where a neutral third party facilitates payment of the funds required for two parties involved in a transaction.

This ensures the safety of the money and increases the reliability of the exchange.

Epicentre struggling to repay creditors

Epicentre has been met with statutory demands from three creditors and is in the midst of seeking legal advice and evaluating their repercussions. In addition, Epicentre is devising a workout plan pronto in hopes of compensating creditors.

In the meantime, the company is led by independent directors who prioritize Epicentre’s well-being.

Wait, what?

In case you didn’t know, Epicentre wasn’t doing very well.

Competition Too Intense

Back in 2018, Epicentre Holdings actually sold all its Epicentre stores and online store to Elush Retail Group for $516,275.

That’s right, the Epicentre you went to isn’t exactly the same one you went to five years ago to look at the iPod Touch Gen 2.

The ex-powerhouse in Singapore blamed competition from the Apple Store and other Apple Premium Retailers for their falling sales.

Underlying internal issues surfaced

Upon review of the company’s FY2017 accounts, “governance and internal control issues” started to transpire. This emerged due to consultancy services agreements, a supply agreement involving Mr Lim, and a breach of internal policy relating to a $1.76 million loan.

Since then, Epicentre has implemented measures to improve internal controls.

A third party auditor was engaged

In 2017, Epicentre found that their auditor, BDO, had not been transparent about their accounts. Hence, Deloitte & Touche (D&T) was engaged to re-evaluate the accounts.

After reviewing agreements which involved consultancy services rendered by Epicentre, D&T revealed that governance and internal control issues were apparent. The company’s primary focus was running IT retail outlets (which we all know) – a far cry from providing consultancy advisory.

All in all, they concluded that the “management should have disclosed the terms of the agreement and the involvement of Mr Lim to the board”.

It is unclear how the series of events will unfold for Epicentre, but we hope they overcome this adversity and find Mr Lim soon.