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Friday, March 24, 2017

Aeon Credit plans 1-for-2 bonus issue; proposes rights issue

By Sulhi Azman / The Edge Financial Daily | March 24, 2017 : 10:45 AM MYT

This article first appeared in The Edge Financial Daily, on March 24, 2017.

KUALA LUMPUR: Aeon Credit Service (M) Bhd plans to make a one-for-two bonus issue of 72 million new shares at an issue price of 50 sen each to reward shareholders.

At the same time, it is also proposing to raise RM432 million via a rights issue of three-year minimum 3.5% irredeemable convertible unsecured loan stocks (ICULS), on the basis of two ICULS for every one existing Aeon Credit share held.

In a filing with Bursa Malaysia yesterday, Aeon Credit said the proposed bonus issue is to reward shareholders, increase the company’s share capital, and improve the trading liquidity and marketability of its shares.

It plans to issue the bonus shares by capitalising RM36 million from the company’s retained earnings.

However, in the event that the proposed bonus issue is not completed for whatever reason, the proposed rights issue will be undertaken on the basis of three ICULS for every one existing Aeon Credit share held.

“The bonus issue entitlement date will be determined and announced at a later date upon receipt of all relevant approvals for the proposed bonus issue,” said Aeon Credit.

It also said proceeds from the rights issue will be used to repay bank borrowings and for working capital. As at Feb 28, 2017, total bank borrowings of Aeon Credit stood at RM5.26 billion.

“Barring any unforeseen circumstances, the proposals are expected to be completed during the third quarter of 2017,” said Aeon Credit.

Aeon Credit shares closed up six sen or 0.36% at RM16.56 yesterday, bringing a market capitalisation of RM2.39 billion.

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