April 29, 2021

Aspen says time difference with US caused delay in clarifying Honeywell deal

By ellen

SINGAPORE (THE BUSINESS TIMES) – On the heels of retracting announcements that it had clinched a US$210 million (S$278 million) gloves supply order from Honeywell, Aspen Holdings has issued a response to Singapore Exchange’s (SGX) queries about the delay in disclosing that the agreement with Honeywell had not yet been consummated.

In a Thursday (April 29) filing, the group explained that it had received what it believed to be the final Honeywell agreement on April 10, “after months of negotiations between the parties dating back to October 2020”.

Its subsidiary Aspen Glove had “duly executed” the agreement on April 12, said the group, while Aspen Glove also believed that Honeywell’s execution of the agreement “was imminent” given that this was noted as the effective date.

Following announcements of the agreement on the morning of April 13, Aspen said it was informed by Honeywell on April 14 of “the communication oversight and the non-consummation” – specifically that Honeywell did not execute the agreement, and that there were internal approvals required before such a step could be taken.

Addressing SGX’s queries on why it took 11 days to retract the initial announcement from the time it was filed, Aspen clarified that the retraction was made within eight working days.

The group added that most of the communication turnaround between Aspen and Honeywell took more than 24 hours due to the 12-hour time difference between Malaysia and the United States, where Honeywell’s officers are based.

Upon receiving clarification by Honeywell, Aspen said its prepared its retraction announcement which was officially approved by Honeywell on April 24, the day Aspen filed it with the SGX.

Lastly, the group affirmed SGX’s query on whether the said agreement would have been deemed a material event which required disclosure, as it said a fully executed agreement would have been a significant contract due to its value of US$210 million.

“(Aspen) had only recently diversified its core business to include the manufacturing of rubber and nitrile medical gloves and the shareholders should be kept informed about the progress of the diversification strategy,” stated the group.

The agreement would have been “price-sensitive information which would be likely to materially affect the price or value of the company’s securities”, it said.

As at 9.25am, Aspen shares were unchanged at 22.5 cents, after the announcement was made.