KUALA LUMPUR: EG Industries Bhd
has obtained the approval of shareholders for its corporate exercises involving a renounceable rights issue and private placement to raise up to RM71.6mil for business expansion and debt repayment.
The company's EGM in Sungai Petani, Kedah, today passed resolutions for a 3-to-2 rights issue of up to 129.43 million shares at 50 sen each and a private placement of up to 9.168 million shares at 75 apiece.
EG Industries said in a statement that the corporate exercises, expected to be completed in the second half of 2015, also entails the issuance of up to 64,713,975 warrants, with the exercise price to be determined later.
The company is an electronic manufacturing services (EMS) player.
Group chief executive officer and executive director Alex Kang said increased manufacturing demand from EMS customers saw the need to go to the equity market for funding.
"Not only will the corporate exercises provide us with greater flexibility to raise funds without having to incur costs on borrowings, but also strengthen our financial position by deleveraging the group's balance sheet," he added.
At the EGM, shareholders also approved a par value reduction exercise which will reduce the issued and paid-up share capital from RM77.1mil to RM38.6mil.
Upon completion and assuming the full exercise of rights and warrants issue, EG Industries' share capital would effectively increase up to RM140.2mil.
Listed as one of the top 50 EMS players in the world, it has a workforce of more than 2,000 at its manufacturing plants in Kedah, and Prachinburi, Thailand. - Bernama
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