KUALA LUMPUR: OCK Group Bhd
expects to raise gross proceeds of up to RM145.24mil through a proposed renounceable 1-for-2 rights issue of up to 290.49 million new shares with free detachable warrants.
The telecommunication network service provider told Bursa Malaysia the amount was based on the indicative issue price of 50 sen per rights share. The issue price of the rights shares will be determined and fixed by the board at a later date after receipt of all relevant approvals but before the announcement of the entitlement date,
The warrants will be given on the basis of one warrant for every rights share subscribed.
Based on the maximum proceeds of RM145.24mil, the company plans to use RM130mil for business expansion and RM12.89mil for working capital within 24 months from the exercise’s completion.
Business expansion would include investments into acquisition of companies, acquisition of existing brownfield telecommunications infrastructure, and building new greenfield telecommunications infrastructure, inclusive of towers, sites and equipment to lease to telecom operators in the Asean region.
“The objective of this corporate exercise is to strengthen our financial position and prepare the group to seize future opportunities for business expansion and working capital. We are offering our existing shareholders the opportunity to take part in our future plans.” said group managing director Sam Ooi.
“The attached warrants of this exercise will potentially allow the entitled Shareholders to benefit from the possible capital appreciation of the Warrants and increase their equity participation in the company.”
Early this month OCK shares fell from 84 sen to 78.5 sen, but their price has since climbed back to close at 83 sen on Tuesday (2 sen higher than Monday’s close).