SOILBUILD Construction Group is proposing a non-renounceable, non-underwritten preferential offering to raise net proceeds of around S$8.1 million.
The offering is for up to 167.37 million warrants at S$0.05 for each warrant, with an exercise price of S$0.18 for each new share. This is on the basis of one warrant for every four existing ordinary shares and the warrants can be exercised during a five year period.
The total issue price and exercise price is S$0.23, which represents no discount or premium to the weighted average price for trades done on the Singapore Exchange on Monday.
"The offering has been proposed to strengthen the capital base of the company and better position the company to take advantage of opportunities for business growth," said Soilbuild.
Soilbuild intends to use up to S$2.5 million of the net proceeds for the acquisition of plant and equipment for its construction works in Myanmar, and up to S$5.6 million as working capital to secure new construction contracts and for the execution of its pre-existing construction contracts in Myanmar and Singapore.
The company intends to use the exercise proceeds to fund its expansion in Myanmar and Singapore, by - among others - securing more contracts and further establishing the business.
Assuming all the warrants are exercised, the estimated proceeds arising from the exercise of the warrants will be approximately S$30.1 million.