KUALA LUMPUR (May 15): Azam Jaya Bhd (KL:AZAMJAYA) has proposed a private placement to raise up to RM90.3 million, less than two years after its listing, along with an employee share option scheme (ESOS).

The proposed private placement involves the issuance of up to 100 million new shares — representing 20% of its existing issued shares — to independent third-party investors to be identified later, said Sabah-based road infrastructure builder in a bourse filing on Friday.

Based on an illustrative issue price of 90.3 sen per share, the private placement is expected to raise gross proceeds of RM90.3 million.

Of the proceeds, RM57.6 million has been earmarked for working capital, RM20 million for repayment of bank borrowings, RM10 million for the purchase of construction machinery and equipment, and RM2.7 million to defray estimated expenses for the proposals.

The group added that the private placement is also expected to help improve its public shareholding spread, which stood at 19.95% as at Dec 31, 2025, below Bursa Malaysia’s required minimum threshold of 25%.

Upon completion of the private placement, the group’s public shareholding spread is expected to increase to 33.29%.

Azam Jaya was listed on the Main Market of Bursa Malaysia in November 2024.

Separately, Azam Jaya also proposed to establish an ESOS involving up to 10% of the company’s issued shares for eligible directors and employees of the group. The scheme will remain in force for five years and shall be extended for up to another five years.

The proposals, which are expected to be completed by the third quarter of 2026, are subject to the approval of Bursa Securities and its shareholders.

Berjaya Securities has been appointed as the principal adviser for the proposed exercise and placement agent related to the private placement.

Datuk Jonathan Lo Chaw Loong is the group's controlling shareholder, holding a 52.53% stake via private vehicle Lokah Fortune Sdn Bhd.

According to AskEdge data, the stock is trading at a trailing price-earnings (P/E) ratio of 41.2 times. Its valuation is the highest among its peers, including Gamuda Bhd’s (KL:GAMUDA) P/E ratio of 26.9 times and Sunway Construction Group Bhd’s (KL:SUNCON) P/E ratio of 26.3 times.

Azam Jaya’s share price last traded at RM1.04, giving the group a market capitalisation of RM520 million.