KUALA LUMPUR (March 5): Tanco Holdings Bhd is settling RM17.08 million worth of debt owed to major shareholder and group managing director Andrew Tan Jun Suan via the issuance of 341.59 million new shares in the group at 0.5 sen each.

Tanco 's existing issued shares total 830.43 million, of which Tan holds 441.56 million, representing a 51.49% stake.

The settlement will raise Tan’s shares in Tanco to 783.16 million, representing a 65.63% stake in an enlarged Tanco share base of 1.17 billion shares, the group said in a filing today.

It said the proposed debt settlement is to clear off the total sum that Tanco owes to the Tan family, to which the late Datuk Seri Tan Jing Nam has been providing financial support in the form of cash advances and payments since the financial year ended June 30, 2012 (FY12). 

The amounts extended by the Tan family are unsecured, interest free and mostly repayable on demand in cash.

Tanco is involved in resort developments, mainly in Port Dickson and Kuantan.

It has been loss-making for six consecutive quarters, with losses of RM6.03 million recorded in the first six months of FY20, compared with RM6.79 million the year before. Revenue fell 25.97% to RM2.12 million from RM2.87 million.

Tanco shares closed up 0.5 sen or 12.5% at 4.5 sen today, giving the property developer a market capitalisation of RM37 million.