This article first appeared in The Edge Financial Daily on October 12, 2017

KUALA LUMPUR: Electronic manufacturing services (EMS) provider EG Industries Bhd said its redeemable convertible preference shares (RCPS) have been oversubscribed by 26.09% times.

In a filing with Bursa Malaysia yesterday, the group said it received applications for 66.69 million RCPS worth RM63.4 million, out of the 52.89 million RCPS that were offered, representing a subscription level of 126.09%. The rights issue involved the issuance of 52.9 million RCPS of 95 sen each.

“The one-for-four rights issue with bonus issue will eventually increase the group’s total outstanding shares to 386.3 million, from 211.6 million as at June 30, 2016,” the group said in a separate statement.

It added that at an issue price of 95 sen per RCPS, the corporate exercise raised RM50.2 million in proceeds, which will be used primarily to expand its business.

“The proceeds will facilitate our continued growth in the EMS sector by acquiring more machinery to expand capacity for the second factory in Sungai Petani, enhancing our research and development capabilities, and granting us more working capital to reinforce our objective to be a strong partner for international customers,” said its group chief executive officer Alex Kang.

EG Industries shares rose 0.5 sen or 0.66% higher at 76 sen yesterday, with a market capitalisation of RM160.56 million.