Friday 29 Mar 2024
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KUALA LUMPUR (Dec 21): Education material publisher Sasbadi Holdings Bhd has proposed to undertake a private placement to raise up to RM31.75 million, assuming an indicative issue price of RM2.50 per placement share to part finance future acquisition of publishing/education/education-related business(es) or intellectual property rights, to repay bank borrowings and for working capital.

In a filing with Bursa Malaysia today, Sasbadi said the proposed private placement will involve the issuance of up to 12.7 million new shares or 10% of the issued share capital of Sasbadi, at an issue price to be determined and announced later.

Sasbadi said the placement shares shall be priced at not more than 10% to the five-day volume weighted average market price of Sasbadi, but not lower than the par value of Sasbadi shares of 50 sen each.

"The board of directors is of the view that the proposed private placement is the most appropriate avenue of fund raising as it enables Sasbadi to raise funds to partly pare down its borrowings, which would give rise to interest savings of RM500,000 per year," said the group.

"In addition, Sasbadi would be able to raise additional funds without incurring interest expenses or service principal repayments compared with conventional bank borrowings or the issuance of debt securities. This would allow Sasbadi to preserve cash flow for reinvestment and/or operational purposes," it added.

The group is also proposing a share split involving the subdivision of every one existing share of 50 sen each in Sasbadi into two shares of 25 sen each on an entitlement date to be determined and announced later, to enhance the stock's marketability and trading liquidity.

As at Aug 31, 2015, Sasbadi's share capital stood at RM63.5 million comprising 127 million shares.

"Assuming full issuance of 12.7 million placement shares pursuant to the proposed private placement, the enlarged issued and paid-up share capital of the company shall be RM69.85 million comprising 139.7 million shares.

"Accordingly, upon completion of the proposed share split, the enlarged issued share capital of the company will be RM69.85 million comprising 279.4 million subdivided shares," said Sasbadi.

"Barring any unforeseen circumstances and subject to all relevant approvals being obtained from the relevant authorities and/or parties, the proposals are expected to be completed by the second quarter of 2016," said Sasbadi.

Sasbadi shares closed up 3 sen or 1.17% at RM2.59 today, for a market capitalisation of RM325.1 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
 

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