KUALA LUMPUR (Mar 25): ACE-listed Managepay Systems Bhd announced a private placement of up to 30% of its issued and paid-up share capital to third party investors that it has yet to identify, with the issue price fixed at 23 sen per share.

In a filing with Bursa Malaysia this afternoon, Managepay (fundamental: 1.5; valuation: 1.5) said the issue price of 23 sen per share represents an 8.25% discount to its 5-day volume weighted average market price (VWAMP) of 25.07 sen, calculated from March 18 to March 24.

At the issue price of 23 sen per share, the group expects to raise a minimum gross proceeds of RM27.78 million, assuming that none of its outstanding warrants are exercised prior to the private placement.

If all of its outstanding warrants are exercised, Managepay said it expects to raise a maximum proceed of RM40.41 million.

As at March 12, Managepay’s issued and paid-up capital stands at 402.67 million shares or RM40.27 million, with an outstanding 183.03 warrants; each warrant carries the right to subscribe for one new ManagePay Share during the three-year exercise period. The warrants will expire on Aug 6.

Assuming that all of its 183.03 million warrants are exercised, the group’s issued and paid-up capital will increase to 585.7 million shares or RM58.6 million.

“Accordingly, a total of up to 175.71 million placement shares representing 30% of the group’s enlarged issued and paid-up capital will be issued,” it said.

Managepay said the bulk of the gross proceeds will be used to fund its capital expenditure for its e-Money project and working capital, which it expects to complete within one year.

To recap, the group had on Feb 24, 2014 announced that its wholly-owned subsidiary ManagePay Services Sdn Bhd had received a letter of award from Bank Negara Malaysia to issue e-Money via online wallet and prepaid card, limited at RM10,000 per account holder.

Pending approval from its shareholders at the upcoming extraordinary general meeting, Managepay expects to complete the proposed private placement in the second half of this year (2H15).

The stock closed unchanged at 26 sen at noon-break today, giving it a market capitalisation of RM104.69 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.)