SINGAPORE, NNA - Tri-Stage Inc., a Japanese provider of direct marketing support services, is divesting itself of its Singapore subsidiary JML Singapore Pte. Ltd. due to sluggish business stemming from what it calls changes in the marketing environment and product obsolescence.
Tri-Stage’s board of directors decided on Wednesday to sell all its shares in JML Singapore to Responze TV International Limited, a TV direct selling-wholesaler based in the British Virgin Islands, and an individual Singapore investor, the Tokyo-based company said in a statement.
The sales price is set at 2 Singapore dollars ($1.44) and the shares are scheduled to be transferred on Aug. 30, the statement said. Tri-Stage will also write off about 317 million yen ($2.99 million) in debts owed by JML Singapore.
Founded in 2010, JML Singapore has engaged in TV shopping and other retail and wholesale businesses as well as e-commerce business, selling daily necessities, health equipment and beauty foods among other products. It is owned 75 percent by Tri-Stage, 15 percent by British TV shopping company John Mills Ltd. and 10 percent by Responze TV International.
Tri-Stage acquired the stake in JML Singapore in September 2016 and has since specialized in such businesses as TV shopping and the wholesale of Japanese products in Singapore. But the subsidiary’s performance has “remained below what we expected at the time of share acquisition due to changes in the business environment, product obsolescence and other factors,” resulting in a goodwill impairment loss for the parent company in the March-August term in 2018, the statement said.
In its medium-term management plan released in April, Tri-Stage vowed to focus on building foundations in TV direct marketing support services as well as direct mail, web and marketing businesses. The company also took it upon itself to review other businesses in terms of profitability and group synergy effects.
Tri-Stage has decided to sell off its shares in JML Singapore because additional investment would be necessary to improve the subsidiary’s performance and there was a “low possibility” that the Singapore business would create synergy effects with the direct marketing support services, the statement said.