The proposed initiatives include a private placement of new shares of up to 20% of the current share capital of the company, a two-for-one bonus issue and a one-for-five renounceable rights issue.
"These initiatives mark one of our most significant corporate actions since our listing in 1978 and will provide existing and new shareholders with an opportunity to share in our growth," said managing director Datuk Edward Lee Ming Foo in a press release last Friday, Jan 7.
The right issue to be issued at a discount of about 35% will come with a free detachable warrant for each right share, while the new placement shares will be entitled to participate in the bonus issue and rights issue. The bonus issue shares will be entitled to participate in the rights issue.
Hap Seng has also set its dividend policy to pay out up to 50% of profits after tax going forward.
According to Hap Seng chairman Datuk Jorgen Bornhoft, these proposals are intended to both reward the shareholders for their loyalty and set the stage for the company to achieve its growth ambitions.
Hap Seng expects to raise up to RM1.5 billion from the placements and rights issue. The fund will be deployed on growth initiatives in property investment and development, auto dealerships and building materials. Additional proceeds from the exercise of warrants will be utilised for working capital purposes.
"Malaysia's economy is poised for significant growth over the coming years. With our key businesses in property investment and development, auto dealerships, fertilisers, plantations and building materials, we believe we are well positioned to execute our expansion plans and benefit from that growth," said Lee.
CIMB Investment Bank Bhd has been appointed as the adviser for the proposals and the Joint Global Coordinator together with UBS AG for the placement exercise.
The proposals are subject to shareholder approval and applicable regulatory approvals. Further details will be made available in the company's circular to shareholders, which the company intends to dispatch by end February following customary regulatory reviews and approvals.
TOP PICKS BY EDGEPROP
Nearby Airport , Best Choice For Cabin Crew& Pilot
Peaceful Area ,Good For Ownstay & Investment
Segambut, Kuala Lumpur
The Grand Subang SS13 Fully Furnished
Bandar Sunway, Selangor
Welcome Investor, Confirm Rental Beside Famous Uni
[ STAY & INVEST ] BESIDE XIAMEN ,DOOR STEP TO MALL
CORNER LOT Teres Dua Tingkat Kajang Tanah Luas
Twin Key Project Surround by University & Malls
KL Sentral, Kuala Lumpur
NEW 1 Sty SEMI D Seksyen U14 Booking RM500 Only
Shah Alam, Selangor
[270K HOT SELLING INVESTMENT PASSIVE INCOME 2R+2B]
0 Booking , 30K Cash Back , Freehold Condo
Nilai, Negeri Sembilan
Luxury Duplex Concept Condo Beside MRT
Cheras, Kuala Lumpur
[RENTAL GET RM 3000 READY TENANT 2020 NEW PROJECT]
Rumah Berkembar 2 Tingkat di Kuala Kedah
Kuala Kedah, Kedah
Petaling Jaya 3 storey semi factory for rent
Petaling Jaya, Selangor
0 booking fee FOR condo Beside UNIVERSITY
Bukit Jalil, Kuala Lumpur
LUXURY CONDO WITH INFINITY POOL,1st HOME BUYER
Ready Tenant, Confirm Rental Get Up To Rm3000