ASX gets angry as XPD files third denial over director bungle

It’s a case of third time lucky for Chinese soccer boot maker XPD – this week fielding their third ASX query relating to directors’ interests.

And this time, the ASX is getting stern.

In a letter to the company (ASX:XPD), the regulator spelled out the importance of compliance and penalties for not doing so:

“The fact that an entity associated with the managing director of an ASX listed company is delinquent in complying with its substantial holding notice obligations and that has caused the company to be suspended from trading is wholly unacceptable to ASX.

“A failure to comply can expose the substantial holder to serious criminal penalties and civil sanctions, including the potential loss of the securities they hold.”

The China-based company is currently suspended from trade until it rectifies its board make-up to comply with the requirement to have two directors who ordinarily reside in Australia.

ASX compliance officers queried the relationship between the company and listed menswear retailer Sunbridge Group (ASX:SBB), with five common executives moving through both companies since 2013.

But the company denies any involvement, citing similarities in their geographical location in China, common personal or professional links and familiarity with ASX at the root of the cross over.

“The company confirms that there is not, and there has not ever been, any association or relationship, commercial or otherwise, between the company and SBB, their directors and/or their shareholders.”

XPD’s board has been in a state of flux since August, with the top job more akin to a revolving door.

Mr Yubin Qiu was appointed as chairman on August 4 and resigned less than two months later on October 25, with no reason given initially given as to his departure.

XPD put the move down to communication issues with other directors – outgoing chair Yubin Qiu and director Alvin Tan not getting on with the rest of the board.

Shares in the maker of soccer-related products in China last traded at 3.3c.

This week’s questioning follows a number of inquiries from the ASX in October, when XPD struggled to answer questions in regards to the directors’ interests.