SINGAPORE (June 5): The Monetary Authority of Singapore (MAS) and the Commercial Affairs Department (CAD) have launched a joint investigation into current and former directors, and officers responsible for managing Eagle Hospitality Trust (EHT).
The authorities say the investigation stems from a referral by the Singapore Exchange Regulation (SGX RegCo), and follows a review announced by SGX RegCo and MAS on Apr 20.
Although the investigation is primarily to look into possible breaches of relevant laws and regulations, as well as listing rules in relation to the issues surrounding the REIT, the authorities say the scope of the investigation will be widened in the event evidence obtained reveal that other offences may have been committed.
This comes shortly after EHT’s non-executive chairman Howard Wu and deputy chairman Taylor Woods resigned from the REIT’s board of directors on May 26 following the discovery of interested party transactions that were inked by the duo on behalf of trust’s master-lessor subsidiaries.
Wu and Woods, who also double up as co-founders and principals of the REIT’s sponsor Urban Commons, had reportedly signed agreements that were “not on usual commercial terms” and therefore “prejudicial” to the interests of EHT and its minority stapled securityholders.
On May 27, EHT had also announced that its unitholders would not receive any distributions for the period of May 24, 2019 to Dec 31, 2019 - as the REIT would be utilising the funds for the “preservation and protection” of its portfolio.
Trading of EHT units was voluntarily suspended on 24 March 2020, after the REIT had defaulted on a loan of US$341 million, which followed the failure of Urban Commons to place with EHT the full sum of security deposits due under the master lease agreements, as well as to make timely rental payments since December 2019.