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Thursday, January 16, 2014

AZRB proposes corporate exercise to set off accumulated losses


KUALA LUMPUR: Ahmad Zaki Resources Bhd (AZRB) has proposed a corporate exercise involving reducing its paid-up share capital and a rights issue with warrants to reduce the accumulated losses at the company level.
It had on Wednesday proposed to reduce the paid-up share capital by cancelling 25 sen from each 50 sen share and a renounceable rights issue of up to 207.7million new shares with 103.85 million free warrants.
AZRB said the rights shares would be issued at 50 sen each on the basis of six rights shares with three warrants for every eight existing shares held after the proposed par value reduction.
“The company is currently in an accumulated loss position at the company level, which is primarily the result of a write-off of an advance to a subsidiary incurred in financial year ended (FYE) Dec 31, 2010 relating to one of its projects in Saudi Arabia,” it said.
AZRB said the par value reduction would enable it to eliminate the accumulated losses arising from this event and place the group on a platform for future growth moving forward.
The paid-up share capital of RM138.47mil comprising of 276.94 million shares of 50 sen each would be reduced to RM69.23mil comprising of 276.94 million shares of 25 sen each.
“The credit arising from the proposed par value reduction will be utilised to fully set-off against the accumulated losses of the company and the remaining balance will be credited to capital reserves of the company,” it said.
AZRB said the proposed par value reduction would give rise to a credit of RM69.23mil.
As at Dec 31, 2012, AZRB had audited accumulated profits of RM71.51mil at group level and accumulated losses of RM61.56mil at company level.

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