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KUALA LUMPUR: Ekovest Bhd
has proposed a private placement of up to 269.58 million shares or 10% of the total number of its issued shares, which will help to raise funds for the construction of the Rapid Transit System (RTS) Link project.
In a filing with Bursa Malaysia, the civil engineering and building group fixed an issue price for the first tranche of the proposed private placement at 43.5 sen per share, which represents a discount of about 4.35 sen or 9.09% over the five-day volume weighted average market price up to and including Aug 29, 2023.
The group said it expects to raise gross proceeds of up to RM117.27mil from the proposed private placement, of which RM86mil will go towards partially funding the construction of the RTS Link project.
In addition, RM28.47mil will be utilised for general working capital and the remaining RM2.8mil for expenses related to the proposed private placement.
“While the company believes that the group’s current cash and bank balances are adequate to meet the group’s working capital requirements for its day-to-day operations, the company is proposing to undertake the proposed private placement to introduce strategic and/or institutional investors into Ekovest’s current shareholding mix while raising the required funds for the group’s business expansion,” it said.
As at June 30, 2023, the group said its cash and bank balances including investment funds and short-term deposits stood at RM675.34mil.
Following the proposed private placement, Ekovest’s gearing will be reduced to 2.59 times from 2.71.
Bursa Securities halted trading in Ekovest’s securities from 2.34pm to 3.34pm on Wednesday in light of the announcement.
As at 4.05pm, the trading stock of the company was up 3.5 sen or 7% to 53.5 sen a share on the back of 196 million shares exchanging hands.
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