HSSEB

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OTHERS HSS Engineers Berhad ("HEB" or "The Company") - Extension of Timeframe for the Utilisation of Proceeds raised from the Initial Public Offering

HSS ENGINEERS BERHAD

Type Announcement
Subject OTHERS
Description
HSS Engineers Berhad ("HEB" or "The Company") - Extension of Timeframe for the Utilisation of Proceeds raised from the Initial Public Offering

Reference is made to the utilisation of proceeds raised from the Initial Public Offering (“IPO”) as disclosed in the Company’s prospectus dated 29 June 2016 that was issued in conjunction with the listing of the Company on the ACE Market of Bursa Malaysia Securities Berhad on 10 August 2016, the announcements dated 6 February 2018 and 23 December 2020 respectively in relation to Variations and Extension of timeframe (“EOT”) for utilisation of proceeds raised from the IPO and Circular to Shareholders of HEB dated 23 May 2019. As at to-date, the Company remains a balance of RM18 million IPO proceeds which has yet to be utilised ("Balance IPO Proceeds").

 

1.  INTRODUCTION

 

The Board of Directors of HEB (“Board”) wishes to announce that the Board has deliberated and resolved to further extend the timeframe for the utilisation of the Balance IPO Proceeds allocated for expansion into India & ASEAN and to venture into recurring income and long term based contracts with focus within the power sector which were initially intended to be utilised up to 31 December 2021.

 

 

2. DETAILS OF THE EOT FOR THE UTILISATION OF PROCEEDS

 

As at the date of this announcement, the Company have utilised approximately RM13.91 million from the total IPO Proceeds of RM31.91 million. The Company has yet to fully utilise the IPO Proceeds allocated for expansion into India & ASEAN and to venture into recurring income and long term based contracts with focus within the power sector that were initially intended to be utilised by 31 December 2021. The details of the EOT are set out as follows:-

 

Details of the utilisation of IPO proceeds 

Proposed Utilisation

of IPO proceeds 

RM’000

Actual Utilisation

of IPO proceeds 

RM’000

Balance IPO Proceeds

RM’000

Time frame for Utilisation prior to the EOT

Time frame for utilisation after EOT

Expansion into India & ASEAN

 

3,000

 

-

3,000

 

Up to 31

December

2021

 

Up to 31 December 2022

 

To venture into recurring

income and long term

based contracts with

focus within the power sector

15,000

 

 

 

-

 

15,000

Up to 31

December

2021

Up to 31 December 2022

18,000

-

18,000

 

3. RATIONALE FOR THE EOT

 

After taking into consideration of on-going Coronavirus Disease 2019 ("COVID-19") situation in the ASEAN region, closure of international boarders among ASEAN countries and the rising nationalism in Indonesia and Philippines, the Board is of the view that the aforesaid uncertainties are likely to hamper HEB's geographical expansion plans particularly in Philippines, Indonesia and India. In addition, Indonesia and the Philippines are forecasted to see sharp deceleration of growth, with the International Monetary Fund projecting growth in the barely positive range.

 

Further, the implementation of the movement control order (MCO), conditional movement control order (CMCO), enhanced movement control order (EMCO) and National Recovery Plan had resulted in disruption of the power sector. However, with the current progress of National Recovery Plan and the Government’s efforts towards renewable energy, the Board believes that the sector will regain its momentum for the next few years.

 

As per Company’s announcement dated 23 December 2020, the Balance IPO Proceeds was expected to be utilised on 31 December 2021. However, the Company wishes to extend the utilisation timeframe to 31 December 2022 to cater for any unexpected delay.

 

4. EFFECTS OF THE EOT

 

The EOT will not have any effect on the issued share capital, substantial shareholders' shareholdings, earnings and earnings per share of HEB Group. The EOT is expected to contribute positively to the future earnings of HEB Group as and when the benefits of the utilisation of the proceeds are realised.

 

5. APPROVAL REQUIRED

 

The EOT is not subject to any regulatory authorities or shareholders’ approval. Nevertheless, the Board shall continue to be vigilant and prudent in managing the Balance IPO Proceeds and will continue to disclose the status of the utilisation of the Balance IPO Proceeds in its quarterly reports and annual report until its full utilisation.

 

The Board is of the opinion that the EOT will not have any adverse effect on the financial performance of the Company and is in the best interest of the Company.  

 

This announcement is dated 18 November 2021.

 






Announcement Info

Company Name HSS ENGINEERS BERHAD
Stock Name HSSEB
Date Announced 18 Nov 2021
Category General Announcement for PLC
Reference Number GA1-03112021-00016