JB Foods proposes rights issue of up to 75.8m new shares at S$0.25 per share

JB Foods Limited announced that the company is proposing to undertake a renounceable non-underwritten rights issue of up to 75.8 million shares in the capital of the company at an issue price of S$0.25 for each rights share on the basis of one rights share for every three existing shares in the company.

Based on the existing issued share capital of the company of 227.4 million shares to date, up to 75.8 million rights shares may be issued.

Assuming that all the rights shares are subscribed for, the rights issue will raise approximately S$18.9 million and the net proceeds, after deducting estimated expenses of approximately S$0.1 million to be incurred in connection with the rights issue, will amount to approximately S$18.8 million.

The issue price of S$0.25 for each rights share represents a discount of approximately 57 per cent to the last transacted price of S$0.58 per share on Dec 19, 2017.

The rationale for the rights issue is to raise funds for business expansion and for working capital.

Entitled shareholders will be at liberty to accept (in full or in part), decline or otherwise renounce or trade - during the provisional allotment trading period prescribed by the Singapore Exchange - their provisional allotments of rights shares and will be eligible to apply for additional rights shares in excess of their provisional allotments under the rights issue.

Several shareholders of the company, namely, JB Cocoa Group and Tee Yih Jia Food, have given certain irrevocable undertakings to the company.