Powernet to undertake share split, private placement for biz diversification

PETALING JAYA: Kumpulan Powernet Bhd (KPower) has simultaneously proposed a 1-to-2 subdivision of its shares, a proposed private placement exercise and a diversification into construction business and activities.

The private placement is for up to 35% or 29.32 million new ordinary shares, or 58.64 million new subdivided shares, at an indicative price of RM1.75 per placement share - therefore raising RM51.31 million in proceeds to be utilised for working capital for construction business, general working capital and estimated expenses from the proposal.

According to the group’s Bursa disclosure, 9.4 million of shares or 18.8 million subdivided shares from the proposed placement has been allocated to Datuk Mohd Karim Abdullah, representing 11.22% of its issued share capital.

Another 5.4 million placement shares or 10.8 million subdivided shares, representing 6.45% has been allocated to Grand Deal Vision.

Meanwhile, the remaining 14.52 million shares or 29.04 million shares representing 17.33% of its issuance shall be placed out to qualified persons or parties.

“The proposed private placement forms an integral part of the group’s fund raising strategy to defray its day-to-day working capital requirement for the existing businesses and construction business.

“The management is proposing to undertake the proceeds mainly for the working capital for the construction Awards which are expected to contribute positively to the financial position of the group in future,” the group said in a statement.

It added that the proposed share split is expected to enhance the marketability and trading liquidity of Kpower shares on Bursa.

Meanwhile, the proposed business diversification will include construction business and construction related activities, but not limited to the construction of projects under the energy, utility, infrastructure and logistics sectors.