CEO Morning Brief

EG Industries Proposes 10% Private Placement to Raise RM22 Mil

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Publish date: Thu, 09 Feb 2023, 08:48 AM
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TheEdge CEO Morning Brief

KUALA LUMPUR (Feb 8): EG Industries Bhd has proposed a private placement to raise RM22.41 million to fund its business expansion and working capital.

The placement entails the issuance of up to 40.93 million new shares — representing 10% of EG Industries’ issued shares — to independent investors, the electronic manufacturing services provider said in a bourse filing.

The company said the assumed issue price of 54.75 sen represents a discount of 9.95% to the five-day volume weighted average market price of EG Industries’ shares up to the latest practicable date, of 60.80 sen.

EG Industries said it intends to increase the capacity of its existing manufacturing factories in Sungai Petani and boost the efficiency of its production processes by constructing an additional manufacturing factory at the Batu Kawan Industrial Park in Penang.

The Batu Kawan factory — which is expected to commence by the first quarter of 2024 — will be used for production of the 5G photonics modular products, box-build assembly of the electrical and electronic products, production office, as well as warehouse for finished goods.

EG Industries’ substantial shareholders are chief executive officer and executive director Datuk Alex Kang Pang Kiang (with a 15.74% stake), and chairman and non-independent non-executive director Keh Chuan Seng (6.83% stake).

The group said the private placement is expected to be completed by the first half of 2023.

EG Industries’ share price climbed to a one-year high of 64 sen on Feb 2, and has risen 15% since the beginning of this year. It settled at 61 sen on Wednesday (Feb 8), giving the company a market capitalisation of RM260.39 million.

Source: TheEdge - 9 Feb 2023

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