Alam Maritim to raise RM160m via convertible notes, proposes 1-for-2 bonus issue of warrants

PETALING JAYA: Loss-making Alam Maritim Resources Bhd proposes to issue redeemable convertible notes to raise up to RM160 million.
It also plans to undertake a bonus issue of up to 462.23 million free warrants on the basis of one free warrant for two shares held, which could potentially raise up to RM73.96 million to fund capital expenditure and working capital, among others, based on an indicative exercise price of 16 sen per warrant.
Meanwhile, of the RM160 million proceeds raised from the notes issue, RM50 million will be used for maintenance and inspection/drydocking works; RM80 million as capex for vessel acquisition and conversion; and RM17.6 million as working capital.
The notes, carrying 1% interest per annum with a maturity period of three years, will be issued in three tranches.
Alam Maritim does not expect the proposed notes issue to have an impact on its controlling shareholder as the subscribers will not hold more than a 10% stake.
"In addition, the proposed bonus issue of warrants will enable the existing shareholders to increase its shareholding proportionately upon the exercise of the free warrants,” it explained.
Alam Maritim said the proposed notes issue is the most appropriate avenue of raising funds to improve the group’s financial performance as it is cost effective with a flexibility in drawdown.
The stock was unchanged at 12.5 sen with 722,200 shares done.