Steel prefab firm BRC Asia looking to raise S$47m in placement

STEEL prefabrication firm BRC Asia is looking to raise S$46.99 million to build up its war chest to finance opportunities for investments, acquisitions, alliances, joint ventures and expansion of businesses opportunistically.

On Sunday, it announced that it has entered into a placement agreement with 15 investors who have agreed to subscribe for 37 million new company shares at S$1.27 each.

The placement price represents a 9.93 per cent discount to the volume weighted average price of S$1.41 for trades done on Jan 5, 2018.

The firm added that the placement will also help to increase its current free float from about 11.74 per cent to about 26.14 per cent.

The placees were introduced to the company by its controlling shareholder Esteel Enterprise, which recently took over the firm, and business associates.

The placees include names like Nuocheng International Development & Investment which subscribed for seven million shares, Xinsteel Singapore and D3 Resources which subscribed for five million shares each, Jianyou International Trade which subscribed for three million shares, as well as other corporate and individual investors.

BRC Asia said that the placement will not result in any transfer of controlling interest in the company. Prior to the placement, Esteel had a current 88.26 per cent stake in the company.

BRC Asia had resumed trading of its shares on Dec 1, 2017 after its free float was restored to the 10 per cent level required under exchange rules. Trading in its shares had been suspended on Oct 31 after a takeover bid by Esteel, which is actually an investment vehicle for a trio of Chinese iron and trading businessmen.

Esteel subsequently had to dispose of some of its shares to six independent and unrelated buyers in order to keep BRC Asia listed.