Sinotop proposes capital reduction, repayment and diversification

PETALING JAYA: Sinotop Holdings Bhd is proposing a capital reduction and repayment, share consolidation and diversification of its existing core business into project management and infrastructure construction.
In a filing with Bursa Malaysia last Friday, the company said the proposed capital reduction and repayment will give rise to a credit of about RM276.43 million, which would be used to set off against the accumulated losses and for capital repayment to the shareholders.
The cancellation of 14 sen of the par value of each existing Sinotop share, will see 12.49 sen per share set off against the accumulated losses of the company and 1.51 sen per share repaid to Sinotop shareholders.
Sinotop is also proposing a share consolidation of the company’s issued and outstanding ordinary shares at a ratio of five ordinary shares of 6 sen each (after the proposed capital reduction and repayment) to one consolidated share of 30 sen each.
The proposed share consolidation would result in the existing 1.97 billion ordinary shares being consolidated into 394.90 million ordinary shares.
The China-based fabric manufacturer proposes to diversify its core business to involve project management and infrastructure construction-related businesses via its 100% subsidiary company Gorgeous Goldhill Sdn Bhd.
At presenty, the group is principally involved in the production of customised woven loom-state fabrics made from cotton, synthetic and mixed yarn. It primarily derives its revenue from China, which contributed 91.59% to its revenue last year.