KUALA LUMPUR (Feb 13): TH Heavy Engineering Bhd has proposed a rights issues of up to 1.2 billion new Islamic irredeemable convertible preference shares (IICPS) at 25 sen each, to raise a gross proceed of up to RM300 million.

In a filing with Bursa Malaysia today, TH Heavy (fundamental: 0.35; valuation: 0.3) said the tenure of the preference shares are five years, and the proceeds will be utilised mainly for capital expenditure, working capital, and repayment of debt.

The IICPS will have annual dividends rate of between 3% to 5%.

The company has not decided on the entitlement basis for the IICPS issue. Nevertheless, it expects the corporate exercise to be completed by second quarter of 2015.

TH Heavy appreciated two sen or 4.82% to 43.5 sen today, with 39.26 million shares traded, giving it a market capitalisation of RM461.1 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)