Yong Tai propose to acquire Impression City in Melaka
KUALA LUMPUR: Property developer Yong Tai Bhd
is on track with its corporate exercise to bring in Hong Kong-listed Sino Haijing Holdings Ltd as a new substantial shareholder.
Yong Tai said on Wednesday it had received Bursa Malaysia Securities Bhd and the Securities Commission's (SC) approvals to hold an EGM to seek shareholders’ approval for Sino Haijing's investment in the company.
The entry of Sino Haijing will see it taking up 34.5% of the enlarged issued and paid-up share capital of Yong Tai.
Yong Tai CEO Boo Kuang Loon said the clearance from Bursa and the SC would strengthen the company’s financial position with enhanced shareholders’ funds. These factors are expected to facilitate the continuous business expansion plans of Yong Tai.
“We will despatch the circular to our shareholders today to provide them with relevant information on the exercise and to seek their approval at the company’s forthcoming EGM to be held on Sept 1, 2016,” he added.
Yong Tai will issue new ordinary shares and irredeemable convertible preference shares (ICPS) to Sino Haijing as well as utilising the share premium to reward Yong Tai’s shareholders via a bonus ICPS.
“The proposed bonus ICPS of up to 20.05 million on the basis of one ICPS for every 10 Yong Tai shares held by the shareholders of the sompany is to reward the existing shareholders,” he said.
As the ICPS will be listed on Bursa, this will enable the ICPS holders to trade and benefit from any potential appreciation, Boo added.
To recap, Yong Tai had on Feb 4, 2016 signed a subscription agreement with Sino Haijing’s subsidiary Impression Culture Asia Ltd to formalise the parties’ intention and understanding in relation to the proposed corporate exercise.
Sino Haijing will invest RM280mil in Yong Tai where Impression Culture will subscribe to Yong Tai’s special issue of 150 million new shares totalling RM120mil. This represents 34.5% of the enlarged paid-up share capital of Yong Tai at an issue price of 80 per share.
Impression Culture will subscribe for 200 million ICPS at 80 sen per share amounting to RM160mil.
After the subscription, Sino Haijing will hold more than 33% of Yong Tai.
Once Yong Tai gets its shareholders' approval at the EGM, Sino Haijing will seek the SC's approval to be exempted from undertaking a mandatory acquisition of all the remaining Yong Tai Shares.
Under the corporate exercise, Yong Tai plans to place out 70 million new shares to third party investor(s) which will bring in another RM60mil to RM70mil working capital to the company.
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