KUALA LUMPUR (July 31): Green Ocean Corp Bhd, which is involved in palm kernel crushing and refining of palm oil and palm kernel oil, is planning to consolidate every 10 of its existing shares held by shareholders at an entitlement date to be determined, into one consolidated share.

It currently has 2.11 billion shares for an issued share capital of RM143.49 million, no treasury shares, and 621.43 million outstanding warrants B.

Green Ocean, which is also in the trading of palm oil products and gloves, said in a bourse filing on Monday (July 31) that the actual number of consolidated shares will be determined later, after taking into consideration any new shares that may be issued arising from the exercise of its outstanding warrants B.

Assuming none of the warrants B are exercised into new shares prior to the entitlement date, the 2.11 billion shares would be consolidated into 211.16 million shares. If all of the outstanding warrants B are exercised into new shares before the entitlement, then an enlarged number of 2.73 billion shares would be consolidated into 273.30 million shares.

The exercise is part of its capital management plan to improve its capital structure.

"As the company has a large number of shares in issue and a relatively low trading price range, the board noted that a small movement in the share price may result in high percentage movement in the share price. The proposed share consolidation would lead to a reduction in the number of shares available in the market and may reduce the magnitude of fluctuation of the company’s share price," it said.

On completion of the proposed share consolidation, the company's theoretical market price per share will increase 10-fold, while the total number of shares in issue will be reduced by the corresponding ratio.

Based on the latest transacted market price of its shares prior to the announcement, which stood at 1.5 sen, the reference price would theoretically be adjusted to 15 sen.

The proposed share consolidation, which is expected to be completed by the fourth quarter of this year, comes just a month after Green Ocean proposed to diversify its business to include the distribution and trading of food and beverages (F&B) and food service, to reduce the group’s reliance on its palm oil and glove businesses.

Green Ocean shares closed unchanged at 1.5 sen on Monday, valuing the company at RM23.76 million.

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