KUALA LUMPUR (June 3): Damansara Realty Bhd plans to raise up to RM150 million by issuing redeemable convertible notes to fund its property development activities and for working capital.

In a filing with Bursa Malaysia yesterday, the property developer said it had signed a conditional subscription agreement with Advance Opportunities Fund I and Advance Capital Partners Asset Management Pte Ltd for the proposed issuance.

The note will be issued in four tranches to Advance Opportunities Fund, an open-ended fund established in the Cayman Islands. Advance Capital Partners will act as Advance Opportunities Fund’s discretionary investment manager. Tan Choon Wee is the sole director and founder of the companies.

The group intends to raise RM20 million from the first tranche, RM30 million from the second tranche and RM50 million from the third and fourth tranches respectively.

The application will be submitted to the relevant authorities within two months, Damansara Realty said, targeting to issue the first sub-tranche of Tranche 1 notes in the second half of this year.

The note will mature in 2019 and Damansara Realty will pay an annual interest of 0.1%.

The notes are convertible into ordinary shares in Damansara Realty on the minimum conversion price of 50 sen each, being the par value of the company’s shares, with the maximum of conversion shares to be issued amounting to 300 million.

With this, the group noted its share capital will increase to RM382.03 million comprising 764.06 million shares upon completion of the exercise from RM154.69 million comprising 309.37 million shares.

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This article first appeared in The Edge Financial Daily, on June 3, 2016. Subscribe to The Edge Financial Daily here.

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