KUALA LUMPUR (Nov 6): Global Oriental Bhd has priced its rights issue shares at 50 sen each, which represents a discount of 33.33% from the theoretical ex-rights price of 75 sen.

In a filing with Bursa Malaysia today, the company said the exercise price of the free warrants, which will be allocated on the basis of one warrant for every two rights shares subscribed, is 80 sen apiece.

Global Oriental share price dropped one sen to close at 97.5 sen for a market capitalisation of RM221.65 million.

To recap, the company has made a cash call to raise RM113.67 million for working capital and for debt repayment in February.

According to the earlier announcement, the proposed rights issue with warrants entails the issuance of 227.34 million rights shares with 113.67 million free detachable warrants, on the basis of two rights shares and one warrant for every two Global Oriental shares held.

The cash call exercise came with a proposed par value reduction of 50 sen per RM1 share.

Of the RM113.67 million raised via the exercise, RM58.65 million will be used as a repayment of its borrowings, RM52.42 million for working capital and RM2.6 million for expenses incurred in relation to the proposals.

As at June 30, the company’s borrowing amounted to RM247.5 million.

Global Oriental said its net gearing level will drop to 0.03 time from 0.28 time currently.