KUALA LUMPUR (June 22): Pharmaniaga Bhd has clarified that its recent proposed private placement is an interim fund-raising exercise and not part of the proposed regularisation plan to be submitted to Bursa Malaysia Securities Bhd.

In a filing with Bursa Malaysia on Thursday (June 22), the Practice Note 17 (PN17) company said pending the finalisation and implementation of a proposed regularisation plan, it will continue to source for funds from the capital market as an interim measure to bridge its working capital requirements.

“Pharmaniaga is committed and currently formulating a comprehensive regularisation plan. The requisite announcement will be made in due course and the proposed regularisation plan is expected to be submitted to Bursa Securities within the timeframe as stipulated,” the company said.

It expects to submit the plan to the bourse by the third quarter of 2023.

In a June 13 filing with the exchange, Pharmaniaga announced its plans to undertake a private placement of up to 131.02 million new ordinary shares representing 10% of its total issued shares to third-party investors to be identified later and at an issue price to be determined.

Based on the indicative issue price of 34 sen per share, the proposed private placement exercise is expected to raise gross proceeds of RM44.55 million.

Some RM44.21 million is intended to be utilised as working capital and RM336,000 will be used to defray estimated expenses.

Pharmaniaga said the exercise would enable the company to raise funds while it is formulating a plan to regularise its financial condition which is to be submitted to Bursa Malaysia.

The company fell into PN17 status in February this year, after booking provisions of RM552.3 million for unsold Covid-19 vaccines which resulted in negative equity in its balance sheet.

Pharmaniaga’s largest shareholder is Boustead Holdings Bhd with a 52% stake. Boustead is being taken private by the Armed Forces Fund (LTAT), which controls a 97.63% stake in the conglomerate.

Pharmaniaga closed half a sen lower or 1.37% at 36 sen, valuing the company at RM471.67 million.