V.S Industry Rewards Shareholders With 1 For 10 Bonus Issue Of Warrants

V.S Industry Berhad announced today that it has proposed to undertake a bonus issue of up 395.7 million free new warrants on the basis of 1 Warrant for 10 existing shares held on the entitlement date to be determined and announced later with a tenure of two years.

Managing Director of VS, Datuk S.Y. Gan said, “We are grateful for the continuous support of our shareholders and would like to take this opportunity to express our appreciation towards the confidence and patience given to us as we embark on our next growth journey. This initiative serves as an additional avenue to reward our shareholders, complementing our steady stream of dividends.”

“The Proposed Bonus Issue of Warrants, which are issued at no cost to our shareholders, provide them the option to further increase their equity participation in the Group by exercising the Warrants at a pre-determined price over the tenure of the Warrants. Our shareholders may also benefit from the potential capital appreciation arising from the exercise of Warrants based on the future growth prospects of the Group. From the VS’ perspective, this exercise would potentially provide additional funds to the Group for working capital needs as and when the warrants are exercised without incurring additional interest expense as compared to bank borrowings.”

“Separately, we are excited by our foray into Philippines following the incorporation of a wholly-owned subsidiary in the country,” Datuk S.Y. Gan further added.

V.S said the exercise price of the Warrants will be determined and fixed by the Board at a later date after all relevant approvals have been obtained. It will take into consideration the 5-day volume weighted average share price and historical trading prices of VS shares, the prevailing market conditions and future working capital requirements of the Group.

For illustration purposes, the indicative exercise price of the Warrants is assumed to be RM1.35, which represents a premium of approximately RM0.2163 or 19.08% to the 5-day VWAP of VS shares up to and including the latest practicable date (“LPD”) of RM1.337.

Based on the indicative exercise price of RM1.35, up to RM534.2 million may be raised under the maximum scenario and RM518.0 million for the minimum scenario. The proceeds are expected to be utilised in the following manner:

I.            50% for partial repayment of interest-bearing borrowings;

II.           30% for working capital requirements;

III.          20% for potential investments and expansion of facilities.

The company said the Warrants issue is expected to be completed by 3rd quarter of 2024.

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