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Addvalue to issue shares, options to Bright Star Tech

MAINBOARD-LISTED Addvalue Technologies will issue 266.7 million new shares at S$0.0225 apiece for a total of S$6 million to Bright Star Tech, a company wholly-owned by Bambang Sugeng Kajairi.

Addvalue is also proposing to grant Bright Star Tech options, exercisable into up to 444.4 million new shares at S$0.0225 per option share, totalling S$10 million.

Proceeds from both the share placement and the vesting of options will strengthen the group's working capital as it grows its IDRS (inter-satellite data relay system) business, and will also fund the expansion of its existing business and acquisition of new technologies, Addvalue said on Monday.

Both the issue price and exercise price represent a 10 per cent discount to the volume-weighted average price of S$0.025 per share for trades done on Dec 12, the day the subscription agreement was signed.

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The placement shares will comprise 12.48 per cent of the firm's enlarged share capital, thus making Bright Star Tech a substantial shareholder. Combined with the maximum number of additional option shares, they will make up 27.55 per cent of the further enlarged share capital.

The option shares, when taken together with all the placement shares, may result in a transfer of a controlling interest in Addvalue. Therefore, the vesting of the options and the issue of the option shares are subject to shareholder approval to be obtained at a general meeting which will be convened by March 31, 2020.

Net proceeds from the placement shares will be about S$5.7 million. Of this amount, S$3 million will go into Addvalue's capability development programme for space, while the balance will be used for working capital.

For the options, if exercised, net proceeds are estimated at S$9.5 million. Of this amount, S$7.6 million will fund the expansion of the existing business and acquisition of new technologies, while S$1.9 million will be used for working capital.

Bright Star Tech is a Singapore-incorporated company which acquires or invests in technology-based assets. Its initial key investor will be a limited partnership fund which is expected to be advised out of Hong Kong.

None of Bright Star Tech, its shareholder and the limited partnership fund are existing shareholders of Addvalue. They also do not have any connections including business relationships with Addvalue, the directors and substantial shareholders.

Addvalue, which designs and develops communications technologies, requested to lift its trading halt after the midday break on Monday. Its shares were trading down S$0.001 or 4 per cent at S$0.024 as at 2pm.