The Placement Shares are intended to be placed to persons other than the following:

Transcription

1 NAIM INDAH CORPORATION BERHAD ( OR COMPANY ) PROPOSED PRIVATE PLACEMENT OF NEW ORDINARY SHARES OF RM0.10 EACH IN, REPRESENTING NOT MORE THAN TEN PERCENT (10%) OF THE ISSUED AND PAID-UP SHARE CAPITAL OF (EXCLUDING TREASURY SHARES, IF ANY) ( PROPOSED PRIVATE PLACEMENT ) 1. INTRODUCTION On behalf of the Board of Directors of ( Board ), TA Securities Holdings Berhad ( TA Securities ) wishes to announce that the Company proposes to undertake the Proposed Private Placement. Further details of the Proposed Private Placement are set out in the ensuing sections. 2. DETAILS OF THE PROPOSED PRIVATE PLACEMENT 2.1 Size of placement The Proposed Private Placement entails the issuance of up to 78,223,000 new ordinary shares of RM0.10 in ( or ) ( Placement ), representing ten percent (10%) of the issued and paid-up share capital of of RM78,223,696 comprising 782,236,964 as at 2 September 2015, being the latest practicable date prior to this announcement ( LPD ). 2.2 Placement arrangement The Placement are intended to be placed to persons other than the following: (i) (ii) (iii) a director, major shareholder or chief executive of or a holding company of ( Interested Person ); a person connected with an Interested Person; and nominee corporations, unless the names of the ultimate beneficiaries are disclosed. In addition, the independent third party investors shall be persons who qualify under Schedules 6 or 7 of the Capital Markets and Services Act, 2007, which include inter alia, the issuance of the Placement to each of them for a consideration of not less than RM250,000 or the issuance is made to high net worth individuals whose net personal assets exceed RM3,000,000 or corporations with net assets exceeding RM10,000,000. Subject to the market conditions and the timing of identification of placees, the Proposed Private Placement may be implemented in one (1) or more tranches to a maximum period of six (6) months from the date of the approval from Bursa Malaysia Securities Berhad ( Bursa Securities ) for the Proposed Private Placement or any extended period as may be approved by Bursa Securities. The implementation of the Proposed Private Placement in multiple tranches would provide flexibility to the Company to identify interested investors to subscribe for the Placement within the period as approved by Bursa Securities. For the avoidance of doubt, the issue price for each tranche of the Placement shall be determined separately. The basis of determining the issue price of the Placement is in accordance with market-based principles. 1

2 2.3 Ranking of the Placement The Placement shall, upon allotment and issue, rank pari passu in all respects with the existing save and except that the Placement shall not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of which is prior to the date of allotment and issue of the Placement. 2.4 Listing of and quotation for the Placement An application will be made to Bursa Securities for the listing of and quotation for the Placement on the Main Market of Bursa Securities within one (1) month from the date of this announcement. 2.5 Basis of pricing The issue price of the Placement shall be determined and fixed by the Board at a later date after the receipt of all relevant approvals for the Proposed Private Placement ( Price Fixing Date ) in the following manner: (i) (ii) The Placement will not be priced at more than ten percent (10%) discount to the five (5)-day volume weighted average market price ( 5D-VWAP ) of immediately before the Price Fixing Date; and The Placement will not be priced lower than RM0.10, being the par value of. For illustrative purposes in this announcement, the 5D-VWAP of the up to and including the LPD is RM0.08 per Share. Hence, for the purpose of this announcement, the issue price if the Placement is assumed at RM0.10, being the par value of the. 2.6 Utilisation of proceeds For illustrative purposes, the Proposed Private Placement may raise gross proceeds of up to approximately RM7.82 million based on the assumed issue price of RM0.10 per Placement Share. The gross proceeds are expected to be utilised by and its subsidiaries ( Group or the Group ) in the following manner: Estimated time frame for utilisation of proceeds (from the date of listing of the Placement ) Renovation of shopping mall (1) 2,968 Within 6 months Repayment of bank borrowings (2) 2,160 Within 12 months Working capital requirements for the Group (3) 2,614 Within 12 months Estimated expenses in relation to the Proposed Private Placement (4) 80 Within 1 month Total 7,822 2

3 Notes: (1) The Gateway Centrepoint Seremban shopping mall ( Seremban Mall ) was closed for renovation works since August However, due to the delay in obtaining approvals from the relevant authorities, the Group expects the renovation works to be completed and for the Seremban Mall to be re-opened by December The Group intends to utilise part of the Proposed Private Placement proceeds to cater for the renovation of the Seremban Mall s expenses in the following manner: Description (a) (b) Consultancy (include among others, planner, architect, quantity surveyor, landscape architect, civil and structural fees, mechanical and electrical, etc) Supervision (include among others construction works supervision cost and panel consultants supervision cost) 1,465 (c) Refurbishment works 902 Total 2,968 The above are additional expenses which will be incurred by the Group due to the overall cost of renovation works for the Seremban Mall which have escalated since commencement of renovation works in August The imposition of the Goods and Services Tax ( GST ) in April 2015 and the weakening of the Ringgit Malaysia in recent months during 2015 have impact the overall renovation cost, including the increase in the cost for all the imported materials purchased for the renovation works. Consultancy and supervision expenses have increased in tandem with the overall renovation cost as these cost for the services were charged based on the gross development cost of renovations to the Group. The Group also intends to utilise part of the proceeds for the increased refurbishment costs. (2) As at 31 August 2015, the Group recorded bank borrowings of approximately RM17.76 million arising from credit facilities (which include term loans, hire purchase and overdraft facilities) for purposes of financing its working capital. The Group s monthly instalments is approximately RM180,000 per month. As such, in order ease the Group s cash flow position, the proceeds from the Proposed Private Placement will be used to partially repay the borrowings of over the next twelve (12) months. The repayment of borrowings is expected to result in interest savings of up to approximately RM92,000 per annum. This is calculated based on the interest rate of 7.85% per annum. (3) The Group intends to utilise up to RM2.61 million of the proceeds for the Group s day to day operations to support the Group s existing business operations, mainly for the monthly payment of employees salaries for twelve (12) months. (4) The estimated expenses consist of professional fees, fees payable to the relevant authorities and other miscellaneous expenses. Any variation in the actual amount of the expenses for the Proposed Private Placement will be adjusted proportionately to/from the amount allocated for working capital portion. Any variation between the illustrated proceeds above and the actual proceeds raised from the Proposed Private Placement as well as any differences in the actual expenses in relation to the Proposed Private Placement shall be adjusted to the allocation for working capital requirements of the Group. The actual proceeds to be raised from the Proposed Private Placement are dependent on the final issue price and the number of Placement to be issued. Pending the utilisation of proceeds from the Proposed Private Placement for the above purposes, the proceeds will be placed in deposits with financial institutions

4 3. RATIONALE FOR THE PROPOSED PRIVATE PLACEMENT The Proposed Private Placement will provide the Group with additional funds to fund the escalated costs of the renovation works for the Seremban Mall as set out in Section 2.6 of this Announcement. In addition to the above, the Group intends to reduce its overall bank borrowings. In relation thereto, the repayment of its bank borrowings from the proceeds of the Proposed Private Placement will help to ease the Group s cash flow and will also reduce the Group s gearing position. The Proposed Private Placement will also provide the Group with additional funds for its existing businesses working capital requirements. In February 2015, the Group had begun to diversify its core business into certain activities that were approved by its shareholders, particularly project management consultancy ( PMC ). The Group has since embarked on the PMC roles for: (a) (b) the mixed commercial development consisting among others shop offices, hotel towers and office suite, a mall and related external works at Lot and , Mukim Klang, Daerah Klang Selangor (known as the Gateway Klang Project); and the 30 storey mixed commercial development consisting of basement carpark, lower group shop, duplex shop office, hotel tower, condominium, anchor lot and cineplex and related external works at Teluk Likas, Sabah (known as Likas Boulevard Project). As per the Group s quarterly financial result announced, the Group has successfully recorded net profit for the past two (2) quarterly financial results. However, pending the further revenue streams from the PMC projects as well as the revenue from re-opening of the Seremban Mall to be realised, the Proposed Private Placement will ensure that the Group has the necessary funds to support its existing business operations. After due consideration of the various methods of fund raising, the Board is of the opinion that the Proposed Private Placement is currently an appropriate avenue of fund raising as it enables the Group to raise funds expeditiously to finance the Group s cash flow requirement. [THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 4

5 4. EFFECTS OF THE PROPOSED PRIVATE PLACEMENT 4.1 Issued and paid-up share capital The pro forma effects of the Proposed Private Placement on the issued and paid-up share capital of are as follows: ( 000) Issued and paid-up share capital as at the LPD 782,237 78,224 To be issued pursuant to the Proposed Private Placement 78,223 7,822 Enlarged issued and paid-up share capital 860,460 86, NA and gearing The pro forma effects of the Proposed Private Placement on the NA and gearing of the Group based on the audited consolidated financial statements of for the financial year ended 31 December 2014 are as follows: Audited as at 31 December 2014 Adjustment for the subsequent event up to LPD (1) After the Proposed Private Placement Share capital 77,224 78,224 86,046 Share premium 1,404 1,833 1,753 (2) Accumulated losses (24,715) (25,044) (25,044) Net assets ( NA ) 53,913 55,013 62,755 shares in issue ( 000) 772, , ,460 NA per share (RM) Total borrowings 17,951 17,951 17,951 Gearing Notes: (1) After the grant of 10,000,000 and 88,900,000 SIS options on 3 June 2015 and 18 August 2015 respectively pursuant to the SIS, and subsequent exercise of the 10,000,000 SIS options at the exercise price of RM0.11 into 10,000,000 new on 17 June (2) After deducting the estimated expenses of RM80,000 for the Proposed Private Placement. 5

6 4.3 Earnings and earnings per share The Proposed Private Placement is not expected to have an immediate material effect on the earnings of the Group for the financial year ending 31 December 2015 as the proceeds to be raised are expected to be fully utilised within twelve (12) months from the date of the listing of the Placement. However, it is expected to contribute positively to the future earnings of the Group when the benefits of the utilisation of proceeds are realised. Consequent to the increase in the number of in issue arising from the Proposed Private Placement, the earnings per Share will be diluted accordingly. 4.4 Substantial shareholders shareholdings The effects of the Proposed Private Placement on the substantial shareholders shareholdings in the Company as at the LPD are as follows: Shareholders As at LPD After the Proposed Private Placement Direct Indirect Direct Indirect Quantum Discovery Sdn Bhd 67, , Dato Siaw Swee Hin 49, ,848 (1) , ,848 (1) 7.89 Siaw Swee Woon 1, ,848 (1) , ,848 (1) 7.89 Note: (1) Deemed interested by virtue of his shareholdings in Quantum Discovery Sdn Bhd, a substantial shareholder of the company, pursuant to Section 6A of the Act. 4.5 Convertible securities Save for the outstanding 88,900,000 SIS options which are exercisable into new and the remaining 16,935,545 SIS options which have not been granted to its eligible employees and directors, the Company does not have any other outstanding warrants, options, convertible securities and uncalled capital as at the LPD. The Proposed Private Placement will not have any effect on the existing convertible securities in. 5. APPROVALS REQUIRED The Proposed Private Placement is subjected to and conditional upon the following approvals being obtained: (i) (ii) Bursa Securities for the listing of and quotation for the Placement on the Main Market of Bursa Securities; and Any other relevant authorities and/or parties, if required. 6

7 The Company had obtained the approval of its shareholders at the 40 th Annual General Meeting ( AGM ) convened on 25 June 2015 pursuant to Section 132D of the Companies Act, 1965 that authorised the Directors to issue and allot ordinary shares from the unissued capital of the Company upon such terms and conditions and at such times as may be determined by the Directors to be in the interest of the Company provided always that the aggregate number of to be issued pursuant to the resolution does not exceed ten percent (10%) of the issued capital for the time being of the Company and the Directors are also empowered to obtain the approval for the listing of and quotation for the additional so issued on Bursa Securities and that such authority shall continue in force until the conclusion of the next AGM of the Company or the expiration of the period within which the next AGM is required by law to be held or revoked/varied by resolution passed by the shareholders in general meeting whichever is the earlier. 6. DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS None of the directors and/or major shareholders and/or persons connected with them has any interest, direct and indirect, in the Proposed Private Placement in view that the Placement will be placed to investors as mentioned in Section 2.2 above. 7. DIRECTORS STATEMENT The Board, after having considered all aspects of the Proposed Private Placement, is of the opinion that the Proposed Private Placement is in the best interest of the Company. 8. ESTIMATED TIME FRAME FOR COMPLETION Barring any unforeseen circumstances and subject to the approval of the relevant authority being obtained, the Board expects the Proposed Private Placement to be completed within three (3) months from the date of the approval from Bursa Securities. 9. ADVISER AND PLACEMENT AGENT TA Securities has been appointed as the Adviser and Placement Agent in relation to the Proposed Private Placement. This announcement is dated 4 September