Kelington to undertake private placement

PETALING JAYA: Kelington Group Bhd has proposed to undertake a private placement exercise of up to 10% of its share capital to raise RM18.76-RM23.31 million to finance its new venture in the industrial gas segment.
Kelington plans to deploy between RM6.86 million-RM8.07 million for the purchase of assets for the industrial gas division and RM4.0 million-RM4.60 million to partly finance the subsequent phase of construction of a carbon dioxide gas purification plant,gas manufacturing facilities and gasdelivery systems, while RM3.0 million-RM3.5 million will be used to partly finance the acquisition of carbon dioxide gas purification plant.
Some RM4.50 million-RM6.70 million will be utilised for general working capital, whereas the remainder will be used to foot expenses from the corporate exercise.
The group opined that the corporate exercise is in line with the group’s strategy of growing its recurring income and expanding into the industrial gas business, in addition to being the best option to raise funds without incurring interest cost.
“The new venture into the industrial gases business complements with KGB’s existing project based business model of providing engineering services and is expected to contribute positively to the future financial performance of the group,”it said of the exercise which is expected to be implemented by the second quarter of 2018.
Kelington has already obtained the approvals of its shareholders at the company’s AGM convened on June 13,2017.
The stock rose 0.60% to close at 84 sen with some 360,600 shares done.