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Anchor Resources to issue S$1m in non-convertible bonds for working capital

MALAYSIAN gold mine operator Anchor Resources is proposing to issue S$1 million in non-convertible bonds to minority shareholder Gan Huai Shi, with a six-month tenure and a 20 per cent per annum coupon rate, the company announced in a bourse filing on Friday.

Mr Gan is the son of a substantial shareholder of Anchor Resources, Koh Ah Luan, who owns 6.63 per cent of the company. Mr Gan himself holds a 0.15 per cent stake in Anchor Resources.

The proceeds, estimated to be S$992,000 after expenses, will be used for general working capital as part of the company's cash management strategy.

The issuance "is intended to raise additional funding to strengthen the financial position of the group and to advance the group's strategic plans", Anchor Resources said. Mr Gan is subscribing for the bonds "purely as a financial investor".

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Anchor Resources has an option to redeem the bonds prior to the maturity date, with the right to claw back any part of the interest that has been paid but not yet accrued.

The latest bond issuance comes after the company raised S$2.2 million for debt repayment in April by placing 143.8 million new shares at S$0.0153 apiece to several subscribers.

Anchor had a gearing ratio of 72.2 per cent as at end-2018, with a net debt position of RM30.1 million (S$9.8 million).

Shares of Anchor Resources closed at S$0.014 on Friday, up 0.2 cent.