SINGAPORE (June 22): Halcyon Agri has announced it is undertaking a renounceable non-underwritten rights issue to raise net proceeds of $174.7 million in a bid to strengthen its capital structure and enhance its financial position.
Shareholders will be eligible for one rights share for every two existing shares they own in Halcyon Agri.
The company plans to issue some 797.5 million new ordinary shares at 22 cents each, representing a discount of 35.7% to the volume weighted average price of 34.2 cents per share traded over the last five consecutive market days including the last trading day.
The price also represents a discount of 27.4% to the theoretical ex-rights price (TERP) of 30.3 cents per share.
Prior to the announcement, the total number of issued shares stood at 1.60 billion. The company says that it can issue up to 797.5 million rights shares on a pro rata basis under the general mandate, assuming that no further shares are issued before and after its 2020 annual general meeting (AGM).
The company says net proceeds from the rights issue will be used for operating cash flows and other fixed commitments.
Thus far, the company has not received any undertaking from any of its substantial shareholders to take up their respective rights shares.
The company' controlling shareholder is Sinochem International (Overseas), a wholly-owned subsidiary of Sinochem International Corporation, a Chinese state-owned enterprise. It owns 54.99% of the company.
Halcyon Agri will update shareholders as and when it receives any undertaking from any substantial shareholder.
For 1Q2020, Halcyon Agri suffered a core operating profit loss of $3.7 million owing to reduced rubber production during the 1Q wintering season, and decline in rubber prices.
As at 1pm, shares in Halcyon Agri are changing hands 0.5 cents lower, or 1.4% down, at 34 cents.
