Quick take: Kelington shares advance on proposed bonus issue, free warrants

  • Markets
  • Wednesday, 07 Apr 2021

KUALA LUMPUR: Kelington Group's share price jumped in morning trade on the back of a proposed bonus issue and free warrants for shareholders.

The share had risen to a high of RM2.35 apiece earlier in the day before easing to RM2.31 at 10.14am, which represents a 20 sen or 9.48% advance over the reference price.

This was on the back of 5.7 million shares done.

In a statement, the integrated engineering solutions provider said the bonus issuance will be on the basis of one bonus share for every one existing Kelington share held (one-for-one) on an entitlement date to be determined and announced later.

The free warrants, to be issued after the bonus issue, will be on the basis of one free warrant for every three existing shares held (one-for-three).

CEO Raymond Gan believes this is another avenue for the group to reward its shareholders in addition to dividends.

“The proposed bonus issue of shares and warrants is an expression of our appreciation towards the confidence and patience given to us while we embark on our growth.

“Furthermore, this is expected to improve the marketability and trading liquidity of our shares and encourage greater participation by investors as well as potentially broadening the shareholder base,” he said.

The proposed bonus issue of shares and warrants could involve the issuance of up to 322.62 million bonus shares, and up to 215.08 million warrants.

Based on the illustrative indicative exercise price of 97.5 sen, the gross proceeds to be raised upon full exercise of the warrants is approximately RM209.71mil.
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