Vivocom to raise up to RM99.37m via private placement, proposes one-for-three bonus warrants
KUALA LUMPUR (March 3): Vivocom Intl Holdings Bhd has proposed a private placement to raise gross proceeds of up to approximately RM99.37 million, paired with one-for-three bonus warrants.
In a filing with Bursa Malaysia, the group said the placement size represents 10% of its total issued shares, and will be offered to third party investors to be identified later.
It said the placement shares may be issued based on a discount of up to 10% to the five-day volume-weighted average market price (VWAP) of Vivocom Intl shares immediately preceding the price-fixing date.
“For illustrative purpose only, the indicative issue price of the placement shares is assumed at 98 sen per placement share, which represents a discount of approximately 9.12% to the five-day VWAP of Vivocom shares up to and including the LPD [latest practicable date] of RM1.0784 per share,” said the company.
Of this amount, up to RM98.06 million will be allocated for the group’s working capital for ongoing and upcoming new projects while the balance of up to RM1.3 million will be used to defray the estimated expenses of the proposed private placement.
These projects include a 45-storey apartment building block comprising 900 units, car park bays, and other common facilities, which is being developed by V Development Sdn Bhd. Vivocom Intl has proposed to acquire a 45% stake in the property developer for RM170 million, which will be satisfied through a combination of cash and the issuance of shares.
Vivocom Intl’s 78.6%-owned subsidiary Vicocom Enterprise Sdn Bhd is the main contractor of the project.
Meanwhile, the proposed bonus warrants will entail the issuance of up to 371.77 million free warrants in the company on the basis of one warrant for every three existing Vivocom Intl shares held on an entitlement date to be announced later.
“For illustration purposes, assuming that all Warrants F are exercised at the exercise price of 95 sen per Warrant F, the company will raise gross proceeds of up to approximately RM353.18 million,” said Vivocom.
The group said the proposed acquisition of V Development will enable Vivocom to access land banks and to undertake the ongoing and future development projects of the V Development Sdn Bhd group of companies throughout the development tenure and sustain their earnings in the future.
“Additionally, the group is also able to leverage on the potential integration synergy derived from the proposed acquisition whereby the development projects may rely on the group's in-house construction, and aluminium design and fabrication capabilities to carry out the development projects.
“Premised on the above and barring any unforeseen circumstances, the board is optimistic on the business strategy of the group and remains optimistic of the future prospects of the group,” it said.
Barring any unforeseen circumstances, the proposals are expected to be completed by the third quarter of calendar year 2021.
At press time, shares of Vivocom were one sen or 0.98% higher at RM1.03, with some 24.06 million shares done. This valued the group at RM612.32 million.