Widad proposes private placement to fund future acquisitions

KUALA LUMPUR, July 21 (Bernama) -- Widad Group Bhd has proposed to undertake a private placement of up to 259.25 million new ordinary shares in Widad, representing not more than 9.42 per cent of its issued ordinary shares, to investors to be identified later. 

The exercise is expected to raise gross proceeds of RM86.85 million based on an indicative issue price of 33.5 sen per share. 

The final issue price will be determined by the board and announced later, it said in a filing with Bursa Malaysia today.

Widad intends to earmark RM46.4 million of the proceeds for potential future acquisitions. 

“The future acquisitions could be in the existing industries which the company is currently operating in, or complementary industries to its existing business, or different industries from its existing business,” it said. 

In the event, Widad is not able to identify suitable target for acquisition within the next 12 months, it will vary the utilisation of proceeds for repayment of bank borrowings and for general working capital purposes, which may include but not limited to payment of trade and other payables as well as administrative and operating expenses.

It may utilise approximately RM45 million of the total gross proceeds to partially repay the bank borrowings of the group, while the balance of RM1.4 million will be utilised for its general working capital. 

At present, Widad Group’s bank borrowings stood at RM364.09 million.

-- BERNAMA