Tiger Synergy plans to raise up to RM80m via rights issue, private placement

KUALA LUMPUR (Feb 12): Tiger Synergy Bhd plans to raise up to RM29.54 million via a rights issue with free warrants for working capital and to repay bank borrowings.

At the same time, Tiger Synergy is proposing to raise up to RM50.51 million in a private placement to finance its on-going property development projects and for working capital.

The rights issue exercise entails the issuance of up to 738.44 million rights shares together with up to 738.44 million free warrants (Warrants-D). The cash call will be on the basis of one rights share for every two existing shares as well as one Warrant-D for every one rights share subscribed, at an entitlement date to be determined later.

In a bourse filing yesterday, Tiger Synergy said based on the indicative issue price of 4 sen per rights share, which represents a discount of 35.48% to the theoretical ex-rights price of 6.2 sen calculated based on the five-day volume-weighted average price (VWAP) of Tiger shares up to Feb 3 of 8.4 sen, it expects to raise between RM6 million and RM29.54 million from the exercise.

It added that the proceeds are intended to part finance the working capital of its money-lending business. It intends to lend to house buyers, contractors and suppliers of building materials for its development projects.

The group also plans to use up to RM5.06 million of the proceeds to partially reduce its total bank borrowings, which amounted to RM11.36 million as at Jan 13.

Meanwhile, the private placement exercise involves the issuance of up to 664.59 million new shares, representing up to 30% of the group's enlarged issued shares, together with up to 664.59 million Warrants-D on the basis of one Warrant-D for every one placement share subscribed.

Based on an indicative issue price of 7.6 sen per placement share, which represents a discount of 9.52% to the five-day VWAP of Tiger shares of 8.4 sen as at Jan 13, the exercise could raise up to RM50.51 million.

The proposed private placement with warrants is conditional upon the proposed rights issue with warrants, but not vice-versa.

The proposals are expected to be completed by the second half of this year.

SJ Securities Sdn Bhd has been appointed as the principal adviser and placement agent for the proposals.

Tiger Synergy shares closed down 0.5 sen or 7.14% at 6.5 sen yesterday, with 28.33 million shares done, bringing it a market capitalisation of RM95.21 million.

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