MAica to raise up to RM356m for property expansion

KUALA LUMPUR: Malaysia Aica Bhd (MAica) plans to raise between RM184.50 million and up to RM356.31 million from a proposed corporate exercise involving a rights issue and share placement.
The company said on Friday the indicative issue price of the rights share was 65 sen and placement share at 75 sen.
Under the corporate exercise, it had proposed a renounceable rights issue of up to 475.08 million new shares on a three-for-one basis with 158.36 million free detachable warrants. The warrants would be on a one-for-three rights shares subscribed.
It also proposed to place out 63.34 million shares, or 10% of the enlarged issued and paid-up share capital of MAica after the proposed rights issue with warrants at an issue price to be determined later.
MAica said based on an indicative issue price of 65 sen per rights share and an indicative exercise price of RM1.80 per warrant, the indicative issue price of the rights shares and the indicative exercise price of the warrants would be a discount of about 22.96% and a premium of about 113.35% from/to the theoretical ex-rights price (TERP) of 84.37 sen, based on the five-day volume weighted average price of the MAica shares of RM1.4246.
It said corporate exercise would enable to raise funds and expand the property development business of MAica post-diversification.
On Oct 2013, the company had embarked on a diversification of its core business to include property development. The purpose of the diversification was to enhance the group's future prospects and diversify into other revenue generating businesses instead of depending solely on its existing core business.
It said such expansion activities for the new core business of the Group may include potential acquisition of additional viable land banks and/or property investment and property development projects, which are in line with MAica's immediate strategic plan to augment its new property development business.
The board of directors expects the proposals to be completed by the third quarter of 2014.
"This is a positive strategic move for MAica as we focus to expand the property development business. The funds raised through this exercise will provide for our immediate needs as we would like to progress quickly with our developments. We feel it is important for our shareholders to benefit from the continued evolution of MAica," its executive chairman Datuk Ter Leong Yap.
"I am confident that the property industry, with its strong fundamentals will continue to grow steadily. So much so I am prepared to underwrite my own entitlements," he said.
AmInvestment Bank, RHB Investment Bank and Astramina Advisory Sdn Bhd have been appointed as the joint advisers to MAica.