Raffles United proposes $12 mil rights issue; another shareholder called up by CAD

Raffles United proposes $12 mil rights issue; another shareholder called up by CAD

By: 
Michelle Zhu
10/01/19, 07:39 am

SINGAPORE (Jan 10): Raffles United Holdings is seeking to raise up to $11.7 million by proposing to undertake a renounceable, non-underwritten rights issue of up to 234 million new rights shares at 5 cents each.

This represents a discount of about 39% to the counter’s closing price on Jan 8, the last trading day prior to the announcement.

Assuming full subscription, the net proceeds are estimated to be $11.6 million after deducting about $0.1 million for professional fees and related expenses.

In a Wednesday filing, the group says the rights issue will enable it to reduce its bank borrowings, finance its working capital requirements, as well as strengthen its overall balance sheet.

Raffles United has been on the SGX watchlist since Dec 5, 2018, after failing to meet the bourse’s minimum trading price criteria.

The group and its subsidiary, Kian Ho, is also being investigated by the Commercial Affairs Department (CAD) regarding an alleged offence under the Securities and Futures Act.

Raffles United on Wednesday issued a separate update announcing that its deemed substantial shareholder, Amanda Marie Teo Xian-Hui, has received an official Jan 9 notification from the CAD related to the release of her bond on Jan 3.

As per its previous updates on this matter, the group emphasises that its business and operations are not affected by the ongoing CAD investigations and will continue as normal.

Shares in Raffles United last traded at 8.2 cents on Jan 8.

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