Zhidao International (Holdings) Limited (01220) has announced additional information regarding an independent forensic investigation into certain allegations related to a loan of HK$10 million, accrued interest, and an account receivable. The loan and the account receivable both involve parties connected to a past acquisition of all remaining equity interest in a subsidiary, completed in February 2020. These allegations concern the loan’s purported transfer to another private entity, the settlement of the acquisition consideration, and questions surrounding the subsidiary’s past financial statements.

The supplemental announcement clarifies that the loan was initially intended for the operations of the acquired subsidiary, and that HK$29 million in acquisition consideration is contested. It further addresses the suggestion that an initial payment was not duly settled. The relevant parties have disputed the loan and account balances as of 31 March 2025, raising concerns about fund transfers and financial account accuracy.

The company continues to follow resumption guidance requirements from the Exchange, including completing the investigation, disclosing material findings, and implementing any necessary remedial actions. Trading in the company’s shares on the Stock Exchange remains suspended until further notice. Shareholders, investors, and potential investors are advised to exercise caution when dealing in the company’s securities.