ECA plans RM67 mil special issue to comply with Bumiputera shareholding requirement

TheEdge Fri, Apr 28, 2023 07:48pm - 11 months View Original


KUALA LUMPUR (April 28): ECA Integrated Solution Bhd has proposed to undertake a special issue of up to 83 million shares to Bumiputera investors, which is estimated to raise some RM66.82 million based on an indicative price of 80.50 sen per share.

The special issue is being undertaken by the automated manufacturing solutions provider to comply with its listing requirements.

ECA was listed on the Bursa ACE Market on Nov 23 last year, under the condition that the company allocates at least 12.5% of its enlarged share base to Bumiputera investors.

According to ECA, the indicative issue price of 80.50 sen per share represents a discount of 9.82% to its five-day volume weighted average market price to April 20 of 89.27 sen.

Of the RM66.82 million gross proceeds, RM50.34 million will be allocated for the company’s working capital, including the purchase of input materials; RM16.18 million will be used for future expansion in the automation industry; and RM300,000 will be used for estimated expenses in relation to this corporate exercise.

“At present, it is the intention of the board to focus on having the adequate capacity to scale up their operations and production output. The enhanced operational and manpower resources will be a cornerstone for the group in catering for the expected increase in orders, allowing ECA to better capitalise on the growth opportunities in the global automation manufacturing solution industry,” ECA’s bourse filing read.

“In addition, the company is in the midst of acquiring new machineries to enhance their technical capabilities in formulating automated manufacturing solutions that better serve the market's needs,” it added.

UOB Kay Hian has been appointed the adviser and placement agent for this corporate exercise, which is expected to be completed by the third quarter of this year.

ECA closed 1.5 sen or 1.73% lower at 85 sen on Friday (April 28), translating into a market capitalisation of RM490.88 million.

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