Kuala Lumpur, April14 – Borneo Aqua Harvest Bhd has proposed to issue up to 325.67 million free warrants on the basis of one free warrant for every two existing Borneo Aqua shares held by the shareholders at an entitlement date to be determined and announced later.
The exercise price for the 7 years warrants was fixed at RM0.87 per warrant, representing a premium of approximately 3.88% over the 5 days volume weighted average market price of Borneo Aqua shares up to and including the last market day immediately preceding this announcement of RM0.8375.
Datuk Lo Fui Ming, Managing Director of Borneo Aqua said the corporate exercise is an appropriate avenue to reward the shareholders for their continuous support through greater equity participation in the Company and allow them to benefit from any potential capital appreciation arising from the exercise of the warrants.
“The proceeds from the exercise of the warrants will further strengthen the capital base and market capitalisation of Borneo Aqua and will enable the Company to raise funds without incurring interest cost, as compared to bank borrowings,” he added.
The proposed free warrants issue will not raise any funds upon its issuance as the warrants will be issued at no cost to the entitled shareholders of Borneo Aqua.
However, the proceeds from the exercise of the warrants will be utilised as its working capital, which may include, mine production cost, cost of prospecting on the subleased mining land (measuring approximately 289.7 hectares out of the total subleased mining land measuring approximately 317.7 hectares by Wullersdorf Resources Sdn Bhd, a wholly-owned subsidiary of Borneo Aqua) and its aquaculture business operations’ expenditure.
The amount raised will depend on the warrants exercised.
The corporate exercise which is expected to be completed in the third quarter of 2017 is subject to shareholders’ approval during the extraordinary general meeting to be convened.