Business

Friday November 6, 2009

MRCB to sell RM566mil rights shares


PETALING JAYA: Malaysian Resources Corp Bhd (MRCB) has proposed to sell rights shares to raise up to RM566mil to fund future business expansion in property and infrastructure development.

The basis for the proposed rights shares, as well as issue price had not been fixed at this juncture, as the “board wishes to have more flexibility in respect of pricing” in view of recent market condition, and the interest of MRCB and its shareholders, the company said.

The maximum amount to be raised was based on an assumption that the rights shares would be sold at RM1.172 each on the basis of one rights share for every two MRCB shares held.

The actual amount to be raised would be determined upon finalisation of the proposed rights shares issue.

The Employees Provident Fund (EPF), the company’s substantial shareholder, has provided a written irrevocable undertaking to subscribe in full the portion allocated to the fund, MRCB told Bursa Malaysia yesterday.

As at Nov 3, EPF holds about 30.6% equity stake in MRCB.

“Underwriting arrangements will be made by the company for the remaining portion of the rights shares for which no irrevocable undertaking to subscribe has been obtained from the other MRCB shareholders,” it said.

The company said underwriting arrangements were expected to be in place prior to the implementation of the proposed rights shares issuance.

Of the amount to be raised, RM85mil would be allocated for equity investment in Nu Sentral Sdn Bhd (NSSB).

NSSB is a 51:49 joint-venture company between MRCB and Pelaburan Hartanah Bhd that was set up to manage a seven-storey retail mall, Nu Sentral, in the Kuala Lumpur Sentral development area.

The mall is currently under development and is targeted for completion in 2012.

To date, MRCB has invested RM38mil in Nu Sentral.

The bulk of the gross proceeds, RM380mil is earmarked for future business investments and expansion of MRCB’s principal activities.

MRCB said the proposed rights issue would allow the company to raise fresh funds without incurring interest expenses or having to service principal repayments.

It would also provide opportunity for entitled shareholders to buy new MRCB shares at a discount to market price.

The fund raising exercise is targeted for completion in the first quarter of next year.


MRCB : [Stock Watch] [News]


For latest Bursa Malaysia indices, charts and other information click here

  • E-mail this story
  • Print this story