Friday 29 Mar 2024
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KUALA LUMPUR (Oct 9): Luster Industries Bhd is proposing to raise RM16.99 million via a private placement to third party investors at an issue price to be determined later, to finance the group’s property development and manufacturing business.

In a filing with Bursa Malaysia today, Luster said the proposed placement entails the issuance of up to 197.6 million new shares or 10% stake in the company.

"Assuming the placement shares are placed out at the indicative issue price of 8.6 sen, the company is expected to raise approximately RM16.99 million," it added.

The illustrative issue price of 8.6 sen per placement share represents a 10% discount to the five-day volume weighted average market price of Luster shares as at Oct 8.

Luster Group intends to utilise RM5 million of the RM16.99 million proceeds for the building and infrastructure works of Phase 2B of Taman Perda Indah mixed project in Seberang Perai Utara, Penang.

The project comprises 928 units of residential properties, 16 units of commercial shop houses and a single-storey street mall, with an estimated gross development value (GDV) and gross development cost (GDC) of RM195.73 million and RM165.51 million respectively.

Another RM2 million will be used for pre-development and pre-marketing expenses for the Hulu Langat Project mixed development in Hulu Langat, Selangor. The project will commence in the second half of 2019 and is expected to be completed in the second half of 2022. It has an estimated GDV of RM242.38 million and GDC of RM207.32 million.

The remaining RM9.9 million of the proceeds are earmarked for the group’s manufacturing business to purchase raw materials.

Barring any unforeseen circumstances, the proposed placement is expected to be completed by the first quarter of 2019.

MIDF Investment has been appointed as the adviser and placement agent to Luster in relation to the proposed placement.

Luster shares closed unchanged at 9.5 sen today, with 999,000 shares done, bringing it a market capitalisation of RM187.72 million.

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