Raffles United Holdings gets SGX nod to list 234.06 million new ordinary shares for $0.05 apiece

The rights issue could raise between $7.6m-$11.6m in net proceeds.

Bearings and seals retailer Raffles United Holdings was granted by the Singapore Exchange Securities Trading (SGX-ST) its approval in-principle for the listing and quotation of up to 234.06 million new ordinary shares under a one-for-one rights issue, an announcement revealed.

The firm first announced its proposal to undertake a renounceable non-underwritten rights issue of up to 234,060,000 in the capital of the company at an issue price of $0.05 for each rights share on 9 January.

The rights issue is expected to raise between $7.6m and $11.6m after deducting approximately $100,000 for professional fees and related expenses estimated to be incurred in connection with the rights issue, the firm noted in a later filing with the local bourse. Raffles United Holdings said it intended to use the net proceeds to repay its bank borrowings, as well as general working capital.

Meanwhile, Raffles United Holdings’ executive director Teo Xian-Hui Amanda Marie, who holds approximately 65.76% or an aggregate of directly and indirectly 153.93 million shares of the issued and paid-up share capital of the company, obtained an undertaking to fully subscribe for her entitlement.

This also includes the 153.42 million rights shares renounced in her favour by investment holding firm Raffles United (RUPL). If no other Raffles United shareholders subscribe for their rights shares, Teo's stake in the company will reportedly increase to 79.4%.

Raffles United Holdings was placed on the SGX-ST Watch-list under the minimum trading price entry criteria with effect from 5 December 2018. Mainboard-listed companies on the list have three years to record a volume-weighted average price of at least $0.20 and an average daily market capitalisation of S40m or more over the last 6 months, or may face delisting by the exchange.