SINGAPORE (Nov 20): Hotel owner and property developer IPC Corporation’s proposed deal to acquire a majority stake in a Chinese company in artificial intelligence has fallen through following the lapse of a heads of agreement, the company says on Monday.

The deal, which was first announced back in Sept 18, would have put IPC back to its former IT roots. The company had then planned to acquire a 51% stake in Beijing iJourney Technology Development for $5.1 million by issuing new shares at 40 cents each.

See: Oei Hong Leong setting up US$5 bil data centre firm; IPC to acquire stake in AI business

See: IPC surges on news of acquisition of AI business, Oei’s One Belt One Net plan

In conjunction with the deal, IPC would also sell the Grand Nest Hotel Zhuhai for RMB200 million ($41 million) in cash to Xinyuan (China) Real Estate.

For the three months to Sept 30, IPC’s loss narrowed 41% y-o-y to $820,000. Revenue in the same period was up 13.1% to $1.03 million. As at Sept 30, it had a net asset value of 98 cents per share.

While the company was founded as a PC maker by the Ngiam brothers, its largest shareholder is now businessman Oei Hong Leong, who holds more than 30% of the shares.

On the same day that IPC announced the sale of the hotel and the acquisition of the Chinese company, Oei publicly declared — without any specific reference to IPC — that he wants to spend US$5 billion to build a data centre business.

He couched this as part of what he called a “One Belt One Net” initiative to build an IT services infrastructure that complements China’s Belt and Road Initiative.

Oei first bought into IPC back in September 2010, through an off-market purchase of shares at 16.09 cents each. Since then, he has made another seven rounds of purchases. The most recent was on June 2, when he bought 850,000 shares at 44.7 cents each.

Right after the Sept 18 announcement, IPC shares spiked by more than half to an intraday high of 64 cents on Sept 19. However, since then, it has dropped back to 43 cents as of Monday, down nearly 18% year-to-date.