KUALA LUMPUR: Metal products manufacturer SMPC Corporation Bhd has proposed a capital reduction of up to RM51.72 million to offset accumulated losses amounting to RM51.88 million as at Jan 31, 2008, as well as a rights issue to raise working capital and to repay borrowings.
The rights issue, to be carried out after the proposed capital reduction and consolidation, would involve an issue of up to 71.62 million shares of RM1 each at an indicative price of RM1 per share on the basis of 18 rights shares for every seven existing shares.
SMPC also proposed a renounceable rights issue of up to RM11.14 million 5% 10-year irredeemable convertible unsecured loan stocks (ICULS) on the basis of RM2.80 nominal value for every seven existing shares, with up to 15.92 million free detachable warrants. It will use RM35 million of the proceeds to repay borrowings.
In another proposal, SMPC will issue 130 million ICULS amounting to RM13 million, as full settlement of a debt to a trade creditor of a subsidiary.