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Hot stock: KOP shares up on Monday after share placement deal with Sam Goi
SHARES in Catalist-listed KOP rose in trading on Monday morning after it announced last week that it had entered into a placement agreement with local tycoon Sam Goi.
The counter rose to S$0.096, up from Friday's closing price of S$0.078 and was among the top five most traded stocks by volume on Monday morning. By around 2.15pm, the counter had eased to S$0.089; some 27.25 million shares worth S$2.51 million had changed hands.
"The market has reacted positively to the announcement, and is likely assuming (Mr Goi) can bring value to the company," said one broker who declined to be named.
However, there was also some grumbling in the market that no trading halt had been called.
According to the release on the Singapore Exchange, KOP and Mr Goi entered into the placement agreement on Oct 6, but it was only announced early on Oct 7. At S$0.0526 per share, the placement was priced at a discount of 4.76 per cent to the volume weighted average price of Oct 5.
Mr Goi, who is the executive chairman of global food and beverage manufacturer Tee Yih Jia Group and GSH Corporation, will subscribe for up to 221.59 million new ordinary shares which will raise up to S$11.08 million for KOP. Upon completion of the proposed placement, he will own 20 per cent of the enlarged share capital of KOP.
In response to queries from BT on his rationale for the investment, Mr Goi said: "I am always on the lookout for companies with good prospects, and I am pleased to have this opportunity to participate as a strategic investor in KOP. I believe the company is well-positioned to tap growth opportunities in its niche markets in Singapore, China and Indonesia."
Mr Goi will nominate a non-executive director and an independent director on the board upon completion of the placement.