KUALA LUMPUR (Sept 26): Ho Hup Construction Co Bhd plans to undertake a private placement exercise of 10% of its share base to raise RM12.4 million, most of which is to be set aside to pay its sub-contractors.
In a bourse filing on Monday, the construction outfit said the private placement exercise entails the issuance of up to 49.49 million shares — 10% of its share base of 494.86 million shares — to independent investors to be identified later, at an issue price to be fixed later.
However, based on an indicative issue price of 25.05 sen per share — a 10% discount to the five-day volume-weighted average market price of Ho Hup up to and including Sept 22 of 27.83 sen — the exercise is expected to raise RM12.4 million in proceeds.
The company noted that it has not undertaken any fundraising exercises in the past 12 months prior.
Breaking down how the proceeds are proposed to be utilised, Ho Hup said RM7.7 million is to be used to pay its sub-contractors, another RM2.5 million for the repayment of borrowings, RM1.87 million for working capital, and RM329,000 to defray the exercise’s expenses.
Ho Hup expects the exercise to be completed by the third quarter of 2023, subject to the requisite approval of Bursa Securities.
M&A Securities has been appointed as Ho Hup’s principal adviser and placement agent for the private placement.
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Source: EdgeProp.my
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