KUCHING: Borneo Oil Bhd (BOB) has fixed the issue price for the first tranche of its private placement at RM0.0223 per placement share.
The issue price represents a discount of approximately 9.72 per cent to the 5-day volume weighted average price (VWAP) of BOB shares up to and including July 28, 2022, being the last trade day of the company shares immediately preceding the price-fixing date of RM0.0247 per share, the company said in a recent filing with Bursa Malaysia.
In May this year, BOB proposed to undertake a private placement of up to 10 per cent of the company’s total issued shares to third party investors(s).
At an indicative price of RM0.0235 per placement share, this will raise up to RM24.74 million for the group’s capital expenses within 36 months.
This fund raising exercise is expected to be completed in the current quarter.
BOB group is principally engaged in food & franchise operation (FFO), property investment and management (PIM), resource & sustainable energy (RSE) and head office and others.
The group owns home-grown fast food restaurant food chain Sugar Bun and operates a pizza chain in Sarawak and Sabah.
A substantial shareholder MT 23 Resources Ltd has increased its stake in BOB, with the acquisition of 6.56 million shares via an off-market deal on Aug 3, 2022.
With the additional shares, this has increased MT 23 shareholdings in BOB to 532,846,000 units or 6.375 per cent.
MT 23 is the legal and beneficial owner of 28.78 per cent of the equity interest in Makin Teguh Sdn Bhd (MTSB), which owns an integrated clinker and cement plant (ILPP) in Lahad Datu, Sabah.
Under a revised sale of shares agreement with MT 23, BOB will reduce the proposed acquisition of equity interest in MTSB to 13.76 per cent for RM45 million from proposed 22.49 per cent for about RM73.6 million under the original agreement.
The ILPP is the first integrated clinker and cement plant in Sabah which has the capacity to produce 720 tonnes per day of Portland grade cement.
The ILPP is situated adjacent to the limestone quarry land owned by BOB group.
MTSB has entered into a long-term supply contract for limestone with BOB’s subsidiaries on the current stockpile and overburdened waste from existing quarrying operations to supplement the ILPP’s initial limestone feedstock requirements.
Meanwhile, YKGI Holdings Bhd has also obtained approval for its proposed private placement from Bursa Securities for the listing and quotation of up to about 48,12 million new ordinary shares representing up to approximately 10 per cent of the company’s total number of issued shares.
Based on an indicative issue price of RM0.115 per placement share, the private placement will raise up to RM5.534 million to fund the group’s working capital purposes.
According to YKGI, about 70 per cent of the proceeds from the private placement will be utilised for the purchase of raw materials and payment of suppliers while the balance 30 per cent for general operating and other administrative expenses.
The company has recently raised about RM1.984 million from the subscription of 10 million new ordinary shares in five tranches by Macquarie Bank, which, under an agreement, will subscribe up to 93 million new YKGI shares.
The money raised is also to be utilised for the group’s working capital requirements.