Serba Dinamik’s private placement to fund future growth, reduce net gearing

Datuk Dr Mohd Abdul Karim Abdullah

KUALA LUMPUR: Serba Dinamik Holdings Bhd said its proposed private placement will enable the group to manage its liquidity and gearing levels to fund current operations and future growth.

The global integrated engineering services provider today passed the resolutions for a proposed private placement involving up to 336.83 million shares.

That represents about 10 per cent of the existing total number of the company’s issued shares as at Nov 30, 2020, which is the latest practicable date prior to the announcement, that was first announced to Bursa Malaysia on Dec 8, 2020.

The proposed placement of up to 101.05 million shares to the managing director and chief executive officer Datuk Dr Mohd Abdul Karim Abdullah or to persons connected to him, which is part of the proposed private placement, represent up to three per cent of the company’s total number of issued shares.

“The successful passing of the resolutions will enable us to manage the liquidity and gearing levels to fund current operations and future growth.

“It will also result in enhanced cash flows, liquidity, interest costs savings and improved gearing levels,” said Abdul Karim in a statement here today.

Part of the funds raised from the exercise will be used as working capital for the projects in Abu Dhabi, which includes the construction of a data centre and related facilities and construction of an innovation hub together with related information technology infrastructure.

“The funds will also be utilised as capital expenditure for the upgrading of production facilities at Teluk Ramunia Yard located in Kota Tinggi, Johor which include site clearing, restoration of existing building facilities, and purchase and installation of heavy machinery and equipment related to fabrication services,” he added.

The issue price of the placement shares, with a discount of not more than 10 per cent, will be determined by way of a book-building exercise and will be fixed based on the volume-weighted average market price of Serba Dinamik shares for the five market days immediately preceding the price-fixing date, according to the statement.

Serba Dinamik has reportedly said its proposed private placement will improve its net gearing to between 0.5 times and 0.6 times from 0.88 times upon completion of the exercise in January 2021. – Bernama