KUALA LUMPUR: Oriental Interest Bhd has proposed a corporate exercise to raise between a minimum of RM52.26mil and a maximum of RM85.17mil, the bulk of which will be to fund existing and/or future property development projects.
In a statement to Bursa Malaysia on Thursday, it said it had proposed a one-for-one bonus issue which involved 154.85 million new shares; 154.85 million rights shares and 154.85 million free detachable warrants.
OIB said the number of bonus shares was based on the share capital as at Dec 16 of RM169.83mil comprising 154.85 million shares.
Upon completion of the proposed bonus issue, its share capital will remain at RM169.83mil while the number of issued OIB shares will increase to 309.71 million.
Based on the lowest daily weighted average share price (VWAP) of OIB shares in the past three months up to and including the last practical date (LPD) of RM1.54 on Oct 1, the adjusted share price will be 70 sen.
It said the theoretical ex-all share price (TEAP) of OIB shares is 82 sen calculated in the five-day VWAP of RM1.90 and the indicative issue price of 55 sen per rights share.
Based on the indicative issue price of 55 sen per rights share, the gross proceeds to be raised from the proposed rights issue with warrants will range from a minimum of RM52.26mil to a maximum of RM85.17mil.
OIB said RM42.57mil of the proceeds would be funding for existing and/or future property development projects and the remaining amount for the purchase of new landbank for property development.
“OIB intends to expand its landbank at strategic areas that would spearhead continued growth going forward. The management of OIB is currently sourcing for commercially viable and sizeable landbank located in Kuala Lumpur, Kedah and Selangor.
“As such, OIB intends to allocate up to approximately RM42mil of the proceeds towards the acquisition of new landbank for its property development projects. The proceeds will potentially be channelled towards payment of upfront deposits for the acquisition of land for potential property development projects.
“The balance/shortfall required to fund the acquisition will be financed through the group’s internally generated funds and/or bank borrowings, ” it said.