MNRB shareholders approve rights issue

KUALA LUMPUR: Shareholders of MNRB Holdings Bhd approved the company’s proposed renounceable rights issue to raise about RM400 million today at an EGM which lasted for about two hours.
The proposed renounceable rights issue, on a basis to be determined later, is intended for the capitalisation of its two subsidiaries, namely Takaful Ikhlas Bhd and Malaysian Reinsurance Bhd (Malaysian Re).
“We need the (two) companies to be financially stronger. If we do not (raise the funds via rights issue) we won’t go anywhere as we need more capital for our plans,” MNRB president and group CEO Mohd Din Merican told reporters today.
Asked on the two-hour long EGM, held after its 45th AGM, he noted that shareholders had raised their concerns on the business prospects and plans of the company following its rights issue.
“As far as the business is concerned, we are looking at various (plans). For Malaysian Re, we are looking at strategic partnerships and new products and for (Takaful) Ikhlas, we’re looking at new products, talent development and enhancing its IT systems,” Din said.
On Wednesday, MNRB told the stock exchange that its largest shareholder AmanahRaya Trustees Bhd has committed to fully subscribe for its entitlement and those of undersubscribed excess rights shares under the proposed fundraising exercise.
Permodalan Nasional Bhd (PNB) has also given its undertaking that it will pick up its portion and the excess.
As of Aug 29, PNB and AmanahRaya held about 12.74% and 42.4% stakes in MNRB respectively.
On its financial performance outlook, Din said the company expects to achieve a satisfactory results for its current financial year ending March 31, 2019 with a “slight growth”, compared with the previous financial year.
“For us, we look at the correlation between the gross domestic product (GDP) and our business. If the GDP is good, (our) business (also) will be good,” he added.
For the first quarter ended June 30, 2018, MNRB raked in a smaller net profit because of lower premiums and contributions from the reinsurance and takaful subsidiaries.
Net profit fell 43.9% to RM28.3 million, while revenue eased 10.1% to RM544 million, both year on year.