KUALA LUMPUR: BANENG HOLDINGS BHD [] will acquire RM29.22 million worth of existing related parties' PROPERTIES [] as part of its restructuring exercise in a bid to strengthen its financial position.
In a filing to Bursa Malaysia on Sept 20, Baneng said the acquisition would be satisfied via the issuance of 29.22 million new shares at par of RM1 per share, as well as an issuance of 14.61 million warrants on the basis of one free warrant for every two consideration shares issued.
The Practice Note 1 (PN1) company said the consideration shares and warrants would only be issued to the vendors upon the completion of the proposed capital reCONSTRUCTION [] and proposed share premium reduction. The properties to be injected are currently charged by related parties to the lenders of the Baneng group.
'The properties have been pledged as collateral to the lenders for banking facilities previously obtained by the Baneng group, and this has been the position since 2000,' the textile and apparel player said.
Baneng said the properties to be injected were mainly owned by its managing director and substantial shareholder Betty Lim Choon Hiok and her family members through their shareholding in several companies, namely Pinevest Sdn Bhd, Kang Hai Realty Sdn Bhd, Kang Hai Holding Sdn Bhd, Twinway Sdn Bhd and Metropolitan Enterprise Sdn Bhd.
The nine properties have a market value amounting to RM29.74 million based on valuations reports dated Aug 10, 2010, adding that the total acquisition price of the properties represented a discount of about 1.8% or RM520,000 to the market value.
Baneng announced to the stock exchange on July 16, 2010 that under the coordination of the Corporate Debt Restructuring Committee, the company and its subsidiaries Maxlin Garments Sdn Bhd and Seri Azhimu Jaya Garments & Textiles (B) Sdn Bhd as well as its associate Baneng Industries Sdn Bhd and former subsidiary Seri Pertamas Garments Manufacturer Sdn Bhd had entered a conditional debt restructuring agreement with the lenders.
It said the agreement was to restructure and reschedule the borrowings that included accrued interest amounting to RM215.45 million as at Dec 31, 2010 via the conversion of RM134.77 million of the secured loans which are sufficiently backed by market value of the collaterals into seven-year term loans bearing 5% interest per annum and issuance of RM14.76 million 7-year 3% redeemable secured convertible loan stocks A (RSCLS-A) to the secured lenders.
The exercise also involves the issuance of RM25.57 million of RM1 nominal value of 7-year 3% redeemable secured convertible loan stocks B (RSCLS-B) to the unsecured lenders, issuance of RM40.34 million of RM1 nominal value of 5-year 2% irredeemable convertible unsecured loan stocks (ICULS) to the secured and unsecured lenders and the issuance of 16.13 million free warrants to all lenders on the basis of one free warrant for every RM5 of the RSCLS-A, RSCLS-B and ICULS issued to each lender.
Baneng also said the company proposed to undertake a capital reduction involving the cancellation of 20 sen of the par value of the existing 60 million ordinary shares of RM1 each in Baneng and subsequently consolidate those shares into 48 million shares of RM1 each as a part of the conditions precedent of the debt restructuring agreement.
Baneng had announced on April 30, 2010, that its subsidiaries, Maxlin Garments and Seri Azhimu Jaya as well as its associate, Baneng Industries had defaulted in their repayment obligations of trade facilities.
For the second quarter ended June 30, 2010 (2Q10), the company posted a net loss of RM401,000 as compared to net loss of RM6.55 million a year ago riding on a revenue that fell 56.5% to RM30.51 million from RM70.21 million. Net asset per share stood at 51 sen as at June 30.
Its share price was unchanged on Sept 20 at 15 sen. Year-to-date, the stock has fallen by 3.23%.
In a filing to Bursa Malaysia on Sept 20, Baneng said the acquisition would be satisfied via the issuance of 29.22 million new shares at par of RM1 per share, as well as an issuance of 14.61 million warrants on the basis of one free warrant for every two consideration shares issued.
The Practice Note 1 (PN1) company said the consideration shares and warrants would only be issued to the vendors upon the completion of the proposed capital reCONSTRUCTION [] and proposed share premium reduction. The properties to be injected are currently charged by related parties to the lenders of the Baneng group.
'The properties have been pledged as collateral to the lenders for banking facilities previously obtained by the Baneng group, and this has been the position since 2000,' the textile and apparel player said.
Baneng said the properties to be injected were mainly owned by its managing director and substantial shareholder Betty Lim Choon Hiok and her family members through their shareholding in several companies, namely Pinevest Sdn Bhd, Kang Hai Realty Sdn Bhd, Kang Hai Holding Sdn Bhd, Twinway Sdn Bhd and Metropolitan Enterprise Sdn Bhd.
The nine properties have a market value amounting to RM29.74 million based on valuations reports dated Aug 10, 2010, adding that the total acquisition price of the properties represented a discount of about 1.8% or RM520,000 to the market value.
Baneng announced to the stock exchange on July 16, 2010 that under the coordination of the Corporate Debt Restructuring Committee, the company and its subsidiaries Maxlin Garments Sdn Bhd and Seri Azhimu Jaya Garments & Textiles (B) Sdn Bhd as well as its associate Baneng Industries Sdn Bhd and former subsidiary Seri Pertamas Garments Manufacturer Sdn Bhd had entered a conditional debt restructuring agreement with the lenders.
It said the agreement was to restructure and reschedule the borrowings that included accrued interest amounting to RM215.45 million as at Dec 31, 2010 via the conversion of RM134.77 million of the secured loans which are sufficiently backed by market value of the collaterals into seven-year term loans bearing 5% interest per annum and issuance of RM14.76 million 7-year 3% redeemable secured convertible loan stocks A (RSCLS-A) to the secured lenders.
The exercise also involves the issuance of RM25.57 million of RM1 nominal value of 7-year 3% redeemable secured convertible loan stocks B (RSCLS-B) to the unsecured lenders, issuance of RM40.34 million of RM1 nominal value of 5-year 2% irredeemable convertible unsecured loan stocks (ICULS) to the secured and unsecured lenders and the issuance of 16.13 million free warrants to all lenders on the basis of one free warrant for every RM5 of the RSCLS-A, RSCLS-B and ICULS issued to each lender.
Baneng also said the company proposed to undertake a capital reduction involving the cancellation of 20 sen of the par value of the existing 60 million ordinary shares of RM1 each in Baneng and subsequently consolidate those shares into 48 million shares of RM1 each as a part of the conditions precedent of the debt restructuring agreement.
Baneng had announced on April 30, 2010, that its subsidiaries, Maxlin Garments and Seri Azhimu Jaya as well as its associate, Baneng Industries had defaulted in their repayment obligations of trade facilities.
For the second quarter ended June 30, 2010 (2Q10), the company posted a net loss of RM401,000 as compared to net loss of RM6.55 million a year ago riding on a revenue that fell 56.5% to RM30.51 million from RM70.21 million. Net asset per share stood at 51 sen as at June 30.
Its share price was unchanged on Sept 20 at 15 sen. Year-to-date, the stock has fallen by 3.23%.
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