SINGAPORE – A group of Cordlife directors has filed an injunction application before the High Court of Singapore to restrain the company from issuing new shares.

Pending a hearing on the application, an interim injunction was granted by the High Court on April 19, said the company on April 22.

The claimants comprise controlling shareholder Nanjing Xinjiekou Department Store and non-independent non-executive directors Zhai Lingyun and Chen Xiaoling.

The application is to prevent the company, its acting chairman Ho Choon Hou, independent directors Yeo Hwee Tiong and Titus Cheong, non-independent non-executive directors Yiu Ming Yiu and Chow Wai Leong, and group chief executive officer Ivan Yiu from engaging in conduct that constitutes a contravention of Section 157 of the Companies Act 1967. The section outlines the duties and liabilities of company officers.

The troubled cord blood bank announced on April 17 a proposal to raise $8.2 million by issuing some 51.2 million new ordinary shares at 16 cents apiece.

Based on the April 17 announcement, it has entered into two separate subscription agreements with Charming Global Enterprises (CGE) and Mr Darren Ng, a high-net-worth individual based in Singapore. Through respective private placements, CGE will subscribe for 44.5 million of the new shares for $7.1 million, while Mr Ng will purchase 6.7 million shares for $1.1 million.

Both will collectively hold about 16.6 per cent of Cordlife’s enlarged capital post the new share placement, which will result in the company’s share base increasing to 307.5 million from the 256.3 million currently pursuant to the private placement.

Cordlife shares slid to an all-time low of 12.3 cents on April 19 before the company requested a trading halt. They resumed trading on April 22 and were down 0.3 cent, or 2.4 per cent, at 12 cents at close of trading. THE BUSINESS TIMES