KUALA LUMPUR: Bank Negara Malaysia has granted a conditional approval on Sapura Energy Bhd’s issuance of new Islamic redeemable convertible preference shares (RCPS-i) to non-resident shareholders.

In the filing with Bursa Malaysia this evening, Sapura Energy said the central bank's approval is subject to the condition that the group is required to convert the proceeds raised from the rights issue of RCPS-i in stages for part repayment of foreign currency borrowings.

Bank Negara will revoke the approval if the proceeds of the proposed rights issue of RCPS-i are used for purposes other than part repayment of foreign currency borrowings.

The approval will also be revoked if Sapura Energy amends any of the terms of the proposed rights issue of RCPS-i, including the use of proceeds without obtaining BNM's prior approval. Besides, if any information or documents submitted by Sapura Energy pursuant to the application to the central bank or subsequent to the grant of the approval is false, inaccurate, incomplete or confusing, or contains any errors or material omission, the approval will be void as well.

The rights issue of RCPS-i to non-resident shareholders is priced at 41 sen each with dividend rate of 5% per annum. The preference shares have a tenure of five years.

The rights issue of RCPS-i is part of Sapura Energy’s massive cash call, which includes rights issue of new ordinary shares, to raise up to RM4 billion.