Asdion to settle RM16.4m debt by issuing new shares

KUALA LUMPUR (Sept 13): Logistics company Asdion Bhd is issuing 67.67 million new irredeemable convertible preference shares (ICPS) and 171.27 million settlement shares at 4 sen per share and 8 sen per share respectively to pay off RM16.41 million owed by the company to Kingdom Saga Sdn Bhd and Million Saint Consultancy Sdn Bhd.

In a Bursa Malaysia filing on Tuesday (Sept 13), ACE Market-listed Asdion said it has entered into two separate settlement agreements with the two creditors. It owed Kingdom Saga RM7.21 million and MS Consultancy RM10 million at end-June.

The settlement shares and the conversion price for the new ICPS of 8 sen represents a slight premium of 0.13% to the five-day volume weighted average market price of Asdion of 7.99 sen on Sept 12.

As on Sept 12, 2022, Asdion had total trade and other payables of approximately RM27.25 million, which will be reduced to approximately RM10.84 million after the proposed debt settlement, on a pro forma basis. Its cash and bank balances stood at RM750,000, which Asdion said should be conserved to facilitate the group’s current logistics business.

Under the minimum scenario, the 67.67 million new ICPS are assumed to be fully converted by surrendering every two new ICPS for one conversion share, while under the maximum scenario, the 67.67 million new ICPS are assumed to be fully converted by surrendering every one new ICPS for cancellation together with payment of 4 sen cash, for every one conversion share.

Upon completion of the proposed debt settlement, Kingdom Saga will hold 90.11 million shares or a 20.93% stake in Asdion under the minimum scenario and 123.94 million shares or a 26.7% stake in Asdion under the maximum scenario. At the same time, MS Consultancy will hold 115 million shares or a 26.72% stake in Asdion under the minimum scenario and a 24.77% stake under the maximum scenario.

The proposals are expected to be completed in the fourth quarter of 2022. TA Securities Holdings Bhd has been appointed as the adviser for the proposed debt settlement.

Asdion shares closed down 0.5 sen or 6.25% at 7.5 sen on Tuesday, bringing it a market capitalisation of RM16.9 million.