KUALA LUMPUR (June 25): Offshore support services provider Yinson Holdings Bhd intends to raise about RM299.5 million through private placement — a move to pare down its bank borrowings.

As at Jan 31, Yinson’s total loans and borrowings stood at RM823.18 million; while gearing ratio stood at 0.57 times at FY15. After the placement exercise, Yinson expects its total borrowings to reduce to RM533.67 million, while gearing could drop to 0.31 times.

In a filing with Bursa Malaysia today, the group said by assuming the issue price for the placement share of RM2.90 apiece, it could raise a gross proceeds of up to about RM299.5 million, of which RM289.51 will be catered for repayment of bank borrowings, while the remaining will be for the corporate exercise expenses.

Yinson (fundamental: 1.5; valuation: 1.5) said the proposal is to undertake a private placement of new ordinary shares of up to 103.28 million shares, representing up to 10% of its issued and paid-up share capital.

“The placement shares will be placed to third party investors to be identified at a later date,” the group said, adding that the issue price will not be priced at more than 10% discount to the five-day volume weighted average market price (VWAP) of its shares immediately before the price fixing date.

Yinson share price has bucked the general downtrend among the oil & gas stocks. Its share price has gained 16% or 44 sen since the start of the year to close at RM3.13 today, for a market capitalisation of RM3.23 billion.

(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.)