Destini shares actively traded after one-for-one rights with warrants offer

KUALA LUMPUR (July 18): Engineering solutions provider Destini Bhd was actively traded on Tuesday (July 18) after the company announced a day earlier that it was planning a renounceable rights issue with free warrants to raise at least RM20.93 million for working capital.

It saw 30.97 million shares traded, far above its 200-day average volume of 6.49 million, and 95 times the 326,000 shares that were crossed on Monday.

At market close, Destini's share price was down 1.5 sen or 15.79% at eight sen, valuing the company at RM126.43 million.

While Destini's share price is unchanged year-to-date, it is down 27.27% or three sen from a year ago.

The proposed fund raising entails the issuance of one rights share for every existing share held by entitled shareholders, with one warrant to be issued for every rights share subscribed for on an entitlement date to be announced.

At an issue price of four sen per rights share — a discount of 40.56% to Destini's theoretical ex-rights price (TERP) of 6.73 sen (calculated based on the five-day volume weighted average market price of 9.45 sen) — Destini is expected to raise RM20.93 million based on the minimum subscription level, whereby only the undertaking shareholders, namely non-independent and non-executive director Datuk Abd Aziz Sheikh Fadzir as well as his nominee companies Dayanine Equity Sdn Bhd and Dayatahan Sdn Bhd, subscribe for their entitlements and additional undertaking.

The group announced earlier this month the return of Abd Aziz, formerly the Member of Parliament for the Kulim-Bandar Baru seat, to its board earlier this month. He subsequently raised his stake in the company to 6.82%, of which 1.17% are directly held.

Abdul Aziz was last on Destini's board between Aug 30, 2017 to May 18, 2018 as its independent, non-executive director.

From the proceeds raised, Destini plans to use 84.81% for working capital and 11.84% for repayment of bank borrowings; the balance will be used to defray expenses incurred by the exercise.

Read also:
Destini plans one-for-one rights issue with warrants to raise at least RM20.93m
Former MP Abdul Aziz ups stake in Destini to 6.82% after rejoining its board
Former MP Abdul Aziz returns to Destini as independent director