KUALA LUMPUR (July 29): Nextgreen Global Bhd has proposed to undertake a private placement of 5.32% of its total number of issued shares to raise up to RM21.09 million for its tissue paper mill joint venture.

The printing and publishing firm said in a bourse filing that the private placement of up to 37 million shares will be issued to third-party investors to be identified later and at an issue price to be determined later.

Based on an illustrative issue price of 57 sen per placement share, the private placement is expected to raise up to RM21.09 million, of which RM16.8 million will be used for its joint venture with Dengkil Paper Mill.

Nextgreen announced on Jan 29 that it had entered into a joint venture agreement with Dengkil Paper Mill to set up a tissue paper mill in Pahang.

According to Nextgreen, the estimated cost for the venture was RM25.5 million.

On May 19, the group completed the redeemable convertible preference shares issuance to raise a total of RM10 million, out of which RM8.70 million was earmarked for the joint venture with Dengkil Paper Mill.

“The proposed private placement is expected to contribute positively to the earnings of the company thereafter, in view of the utilisation of proceeds,” it said.

Barring any unforeseen circumstances, the proposed private placement is expected to be completed by Dec 31.

Nextgreen closed unchanged at 58.5 sen today, valuing the group at RM413.97 million.