CSE Global proposes S$24 million placement to fund acquisitions, investments

CSE Global on Thursday (Mar 14) proposed a placement of 60 million new shares to raise S$24 million for strategic acquisitions and investments.

Each new share will be priced at S$0.40. This represents a discount of 6.6 per cent from the stock’s volume-weighted average price of S$0.4281, based on trades completed on Wednesday – the last full trading day before the placement agreement was signed.

The mainboard-listed automation solutions provider said that the share placement will be made to eligible institutional, accredited and other investors.

The 60 million new shares represent 9.8 per cent of the existing 614.9 million shares in issue, excluding treasury shares. Post-placement, they will comprise 8.9 per cent of the enlarged share capital.

If the proposed placement was completed on Jan 1, 2023, CSE Global’s earnings per share would have fallen to 3.34 Singapore cents from 3.66 cents before the placement, based on pro forma estimates.

It plans to use the net proceeds of S$23.2 million from the placement to pursue more inorganic growth, through strategic acquisitions or investments. This will be primarily in its existing markets, including the US, Australia and New Zealand.

The company, which listed on the Singapore Exchange in 1999, is led by Lim Boon Kheng, its group managing director and chief executive.

In February 2023, the group acquired Radio One for US$11 million. The Florida-based communications solutions company provides voice, video and data solutions to consumers.

The group is also growing its provision of critical communications services – or closed networks – to government agencies and large multinational corporations, it previously told The Business Times in an interview.

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CSE Global said it will rely on the existing general share issue mandate approved by the company’s shareholders at the annual general meeting held on Apr 20, 2023, which means shareholder approval will not be required.

Shares of CSE Global ended S$0.01 or 2.4 per cent lower at S$0.415 on Friday.