KUALA LUMPUR (Jan 9): Wood processing firm BTM Resources Bhd’s six-for-one rights issue at eight sen each, with free detachable warrants, has been under-subscribed by 10.19%.

In a bourse filing, the Terengganu-based company said it received total valid acceptances and excess applications for 921.57 million shares of the 1.03 billion rights shares available under the issuance, translating to an under-subscription of 104.59 million rights shares.

“In view that the total number of excess right shares applied for was 512.44 million, the board has decided to allot the excess rights shares to all the entitled shareholders and/or their renouncee(s)/transferee(s) who have applied for the excess rights shares,” BTM Resources said, noting that total valid acceptances stood at 409.13 million rights shares.

BTM Resources noted that the minimum subscription level for the rights issue with warrants had been achieved, adding that the rights shares and warrants are expected to be listed on the Main Market of Bursa Malaysia on Jan 16.

Based on the 921.57 million rights shares subscribed for at eight sen apiece, BTM Resources will raise RM73.73 million in proceeds, versus RM94.71 million under the maximum scenario which would have seen 1.18 billion rights shares subscribed for.

According to the company’s abridged prospectus for the rights issue, RM24.7 million or 26.1% of the RM94.71 million proceeds under the maximum scenario was to be earmarked for a sublease consideration of plantation lands, followed by RM23.12 million (24.4%) for the construction of a biomass power plant, and RM21.15 million (22.3%) to fund the capital expenditure (capex) of a plantation programme.

Another RM15.03 million (15.9%) was to be set aside for working capital requirements, RM8.2 million (8.7%) to repay advances made by the company’s directors, and RM2.5 million (2.6%) for the estimated expenses of the rights issue.

Shares in BTM Resources ended 1.5 sen or 13.64% lower at 9.5 sen on Monday (Jan 9), giving the company a market capitalisation of RM113.73 million.