KUALA LUMPUR: Minox International Group Bhd
proposes to undertake a bonus issue of 180 million warrants on the basis of one warrant for every two existing ordinary shares with a tenure of five years.
In a Bursa Malaysia filing today, the distributor of stainless-steel tubes, fittings and sanitary valves said that the issue of warrants is not expected to raise any immediate funds as it will be issued at no cost to the entitled shareholders.
"The gross proceeds to be raised upon full exercise of the warrants based on the indicative exercise price is about RM39.6 million.
"Such proceeds will be earmarked to meet the group’s working capital requirements for its daily operations including but not limited to the purchase of inventories as well as defrayment of operational and administrative expenses such as payment of staff salaries, utilities and marketing expenses,” it said.
Minox said the warrants do not entitle the warrant holders to any voting rights in any general meeting of the company.
It said that the rationale for the proposed bonus issue of warrants is that after due consideration of various options available, the board is of the view that it is the most appropriate avenue of rewarding the existing shareholders of the company.
"Moving forward, the exercise is expected to be earnings accretive arising from the utilisation of proceeds from the exercise to finance working capital.
"However, the earnings per share of the group is expected to be diluted as a result of the increase in the number of shares arising from the exercise of warrants,” it said.
The exercise is expected to be completed in the first quarter of 2025.
It said that as at Oct 23, 2024, the total issued share capital of Minox is RM68.09 million comprising 360 million shares, and the company does not retain any treasury shares.
M&A Securities Sdn Bhd has been appointed as the principal adviser. - Bernama
