Sysma Holdings seeks to raise S$16 million through new rights issue

95% of proceeds going to property development.

Catalist-listed Sysma Holdings Limited (Sysma) has announced a proposed renounceable non-underwritten Rights Issue of up to 95,000,000 new ordinary shares (rights shares) at an issue price of S$0.17 for each Rights Share on the basis of one Rights Share for every one existing ordinary share.

Xiang Investment Ltd, the sole controlling shareholder of the Company which directly holds an aggregate of 69,300,000 shares representing 72.95 per cent of the aggregate number of issued shares, has provided an irrevocable undertaking to fully subscribe for its entitlement of the Rights Shares.

The Rights Shares are priced at the issue price of S$0.17 per Rights Share and represents a discount of approximately 39.3 per cent to the closing price of S$0.28 per Share on the Catalist board of Singapore Exchange Securities Trading Limited (“SGXST”) on 13 March 2013.

Mr Sin Soon Teng, Executive Chairman and Chief Executive Officer of Sysma, said: “The recent acquisitions of the two adjacent properties at Race Course Lane will pave the way for Sysma to go into property development. This Rights Issue is to raise additional funding to strengthen the financial position of Sysma so as to capitalise on potential growth opportunities particularly its property development business”.

Assuming that all the Rights Issue is fully subscribed, the estimated net proceeds from the Rights Issue after deducting estimated expenses of approximately S$150,000 is expected to be approximately S$16 million.

Sysma intends to use the net proceeds from the Rights Issue in the following manner: a) 95 per cent of the net proceeds to be used for property development business; and b) 5 per cent of the net proceeds to be used for general working capital purposes.

The rights issue is subject to in-principle approval from the SGX-ST for the listing of and quotation for the Rights Shares on the SGX-ST, as well as shareholders’ approval.

None of the Directors and substantial Shareholders (other than through their respective shareholdings in the Company) has any interest, direct or indirect, in the Rights Issue.