Skin Elements (ASX: SKN) lost 45 per cent this morning after it announced a deal to enter China will not go ahead.

Back in March it announced Henan Huatou Health Management (HMMM) had agreed to distribute its products in China. HMMM would order $20m over three years and make a $2.4 million investment into the company.

Skin Elements and HHM chairman Peter Malone & Li Zeling signing the Term Sheet. (Pic: Skin Elements)

Last night it announced the deal was off with the only given reason being the parties couldn’t agree on several matters. The two HHHM directors who joined Skin Elements’ board have resigned.

The cancellation came despite HMMM placing an initial order of $300,000 and a convertible loan note deposit of $200,000. HMMM agreed to pay the latter within 7 days.

Skin Elements acknowledged this was a setback and said it would seek to raise $1 million.

However it tried to argue it had a brighter future ahead in other markets. It revealed it was in negotiations with a major UK chemist chain, a US online retailer and skincare distributor in Europe.

The market saw things differently sending shares down 45 per cent. Shares had been as high as 5 cents in late April but have gradually declined since then.


In other ASX small cap corporate news today…

AfterPay (ASX: APT) has appointed three more people to its US advisory board. One of these is former US Treasury secretary Larry Summers. The other are former Reebok CEO Uli Becker and former ModCloth CEO Matthew Kaness.

It took the opportunity to update the market on its progress in America. Since entering a year ago, it has gained 6,500 retailers although these account for only 20 per cent of its total retail partners worldwide.

Ecofibre (ASX: EOF) released its quarterly today and its revenue came in at $14.4 million. This is up 140 per cent from the September quarter last year and 17 per cent higher than the June quarter. The cannabis biotech credited this to increased uptake among US retail pharmacies – 600 more sold it than 3 months ago.

ReadyTech (ASX: RDY) has forked out $12.6 million to buy two payroll and workforce management software companies – Zambion and WageLink. acquisition. The companies have over 480 clients between them and are expected to deliver $700,000 in revenue for the rest of the calendar year.