KUALA LUMPUR (April 16): Tiger Synergy Bhd yesterday proposed a rights issue with warrants, as well as a private placement, to raise up to RM102.14 million for working capital needs and to repay bank borrowings.
This comes after the group last month aborted similar cash calls announced on Feb 12, to raise up to RM80 million.
In a filing with Bursa Malaysia, Tiger Synergy said it now plans to raise up to RM68.09 million via a rights issue with free warrants, and up to RM34.05 million in a private placement.
The group said the rights issue entails the issuance of up to 2.27 billion rights shares, together with up to 2.27 billion free warrants, on the basis of three rights share for every two existing shares, as well as one warrant for every one rights share subscribed.
The issue price for right shares would be determined by the board later, Tiger Synergy said.
However, based on the indicative issue price of three sen per rights share, which represents a discount of 314.29% to the theoretical ex-rights price of 3.5 sen calculated based on the five-day volume-weighted average price (VWAP) of Tiger Synergy shares up to latest practicable date (LPD) of four sen, it expects to raise between RM6 million and RM68.09 million from the exercise.
Tyger Synergy said up to RM62.21 million of the money is intended to be used to part finance the working capital of its money-lending business. The group 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 million of the proceeds to partially reduce its total bank borrowings, which amount to RM10.85 million.
Meanwhile, the private placement exercise involves the issuance of up to 1.13 billion new shares, representing up to 30% of the group's enlarged issued shares after the right issue, with warrants under the maximum scenario.
Based on an indicative issue price of three sen per placement share, which represents a discount of 14.29% to the five-day VWAP of Tiger Synergy shares of 3.5 sen up to and including the LPD of four sen, the exercise could raise RM34.05 million.
The group expects the proposals to be completed by the fourth quarter of this year.
Tiger Synergy shares closed up 0.5 sen or 7.69% at 7 sen yesterday, bringing a market capitalisation of RM102.53 million. Some 14.97 million shares were traded.
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