KUALA LUMPUR (May 28): Tambun Indah Land Bhd's rights issue exercise oversubscribed by 9.9% over the 88.4 million rights shares plus 44.2 million warrants available for allotment.
In a statement on Monday, the company said it received 1,326 applications — worth a total value of RM48.6 million — for 97.1 million rights shares priced at 50 sen each, together with 48.6 million free warrants.
"This represented an excess application for 8.7 million shares and 4.4 million warrants,: it said.
Tambun Indah managing director Ir Teh Kiak Seng said the response indicated its shareholders' level of confidence in the group and their readiness to take part in Tambun Indah's long-term success story.
"This rights issue plus free warrants will also help improve our counter's liquidity and marketability by having a larger share base, which can help attract potential investors keen on participating in the Mainland Penang property potential by taking a stake in us,: said Teh.
Tambun Indah said its corporate exercise, which was on the basis of two rights shares and one free warrant for every five existing shares held as of 7 May 2012, would raise RM44.2 million in proceeds.
These funds will be used to help finance the group's working capital requirements for the development of several ongoing projects — namely, Pearl City, Straits Garden, New Juru Industrial Park, Carissa Villas and Kelisa Residence, it said.
Meanwhile, the free 5-year warrants are convertible to Tambun Indah shares on a 1-for-1 basis at an exercise price of 60 sen each, it said.
With the fully-subscribed rights issue, the group's share capital will increase to RM154.7 million from RM110.5 million currently, with its gearing to be in net cash position from 0.23x as at 31 March 2012.
The rights shares would be listed and quoted on the Main Market of Bursa Malaysia Securities Bhd on June 4.