Fintec Global proposes private placement to fund construction of glove factory

Fintec Global proposes private placement to fund construction of glove factory
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KUALA LUMPUR (Aug 12): Fintec Global Bhd has proposed a private placement to raise up to RM19.2 million for the construction of a factory for its glove business. 

In its filing with Bursa Malaysia, Fintec said the placement will involve the issuance of up to 855 million shares, representing 20% of the total number of issued shares.

At an illustrative issue price of RM0.0225 per placement share, the exercise would raise RM19.2 million in proceeds. 

Fintec said RM18.6 million of the proceeds will be used for the construction of the glove factory. The construction costs had increased mainly due to higher steel prices following a global supply shortage, and the expansion to a larger factory built-up area from 10,000 square metres to 20,450 square metres.

To-date, Fintec has incurred RM15.2 million for the construction of the factory, funded by proceeds from the previous corporate exercise completed on Dec 28, 2020. 

"We are making good progress in the construction works of our production facility, which is 55% completed currently. We target to commence manufacturing and sales of medical grade nitrile gloves in the first quarter of 2022," Fintec managing director Tan Sik Eek said in a separate statement.  

"Even as new Covid-19 variants emerge globally, global demand is expected to remain robust and outweigh global capacity, in order to safeguard healthcare professionals that are attending to patients. 

"Therefore, we are eager to be part of the medical equipment supply chain and assist the local and international healthcare sectors by delivering quality personal protection equipment," he added. 

Barring unforeseen circumstances, the proposed private placement exercise is expected to be completed by the second half of 2021. 

Shares of Fintec Global closed unchanged today at 2.5 sen, for a market capitalisation of RM106.9 million. 

S Kanagaraju