ISOTeam launches S$28.9m equity fundraising exercise

CATALIST-LISTED building maintenance company ISOTeam is working to raise some S$28.9 million in a share placement, and the issuance of warrants and shares to a Japanese investor.

In plans released on Tuesday, ISOTeam said that it would place out 84 million new shares at S$0.24 each - a discount of some 1.72 per cent to the latest volume-weighted average price.

OCBC Securities will be the placement agent for this exercise, which chief executive Anthony Koh described in a statement as "ISOTeam's largest fundraising effort since listing" in 2013.

The group has also inked a binding term sheet with Tokyo-listed mechanical and electrical engineering group Taisei Oncho to allot and issue 40 million warrants in two tranches, as well as another 12.5 million consideration shares - all at the same price of S$0.24 apiece.

Altogether, ISOTeam aims to raise about S$19.4 million from the share placement and S$9.5 million from the Taisei Oncho deal. The bulk of the net proceeds are meant for mergers and acquisitions, as well as joint ventures, strategic alliances, and other business expansion opportunities, the company said.

The placement shares will be issued under ISOTeam's share issuance mandate from its last annual general meeting in October, but the warrant and consideration share issuance to Taisei Oncho - which could give the Japanese firm an interest of up to 15.55 per cent in ISOTeam's enlarged share capital - must be put to a vote at an extraordinary general meeting.

Taisei Oncho became ISOTeam's joint-venture partner after agreeing to take a 34.1 per cent stake in ISOTeam's electrical works subsidiary IME in March 2018, and Mr Koh has now said that "their vote of confidence in us means a lot".

"With our enhanced capital resources, we will be in a stronger position to go after opportunities so as to deliver sustainable long-term growth and create greater shareholder value," he added.

ISOTeam shares closed flat at S$0.24 on Tuesday before the announcement.