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KUALA LUMPUR: Sarawak Consolidated Industries Bhd (SCIB) has proposed a rights issue with free detachable warrants and a capital reduction exercise to strengthen its capital base and support future growth initiatives.
The industrialised building systems specialist said the rights issue could raise up to RM53.45 million through the issuance of up to 763.62 million new shares with an equal number of free warrants.
The indicative issue price for the rights shares is seven sen apiece, on the basis of one rights share and one free warrant for every existing SCIB share held.
Executive chairman and major shareholder Datuk Chong Loong Men has committed to subscribe to 143 million rights shares under the exercise.
Proceeds from the rights issue will be used for the construction of a new factory, purchase of machinery, partial repayment of bank borrowings, working capital and to cover related expenses.
SCIB has also proposed to reduce its issued share capital by RM110 million. The move is aimed at rationalising its financial position by offsetting accumulated losses.
Chong said the dual proposals would help bolster shareholder value and reinforce SCIB’s financial flexibility.
“The rights issue with warrants provides an opportunity for our shareholders to participate directly in SCIB’s growth trajectory, while simultaneously reinforcing our capital base,” he said in a statement.
“Meanwhile, the proposed capital reduction reflects our commitment to enhancing transparency and restoring balance sheet strength.”
He added the initiatives are part of efforts to lay a solid foundation for long-term growth, especially as the group aligns itself with Sarawak’s infrastructure development agenda.
A circular on the proposals will be sent to shareholders ahead of an upcoming extraordinary general meeting.
© New Straits Times Press (M) Bhd
