Lambo plans private placement of 775 million shares to raise up to RM24m for wine business

Lambo plans private placement of 775 million shares to raise up to RM24m for wine business
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KUALA LUMPUR (Dec 24): Lambo Group Bhd has proposed to undertake a private placement of up to 775.06 million shares to raise as much as RM24.8 million, which will mainly be used for its wine business.

In a filing with Bursa Malaysia today, the group said the placement shares representing 20% of the total number of issued shares would be undertaken by a third-party investor to be identified later, while the issue price will also be determined later.

The placement shares will not be priced at a more than 10% discount to the five day volume weighted average market price of Lambo shares up to and including the last trading day immediately preceding the price-fixing date.

The company said for illustration purposes, based on an issue price of 32 sen per share, the placement shares could raise up to RM24.8 million.

Of this amount, RM10 million will be allocated to procurement of inventory of wine, RM5 million will be used for marketing and promotional activities, RM4 million for setting up of a new warehouse to store wine inventory, RM3 million for its working capital and RM2 million for development of a new platform to launch a specialised e-commerce platform for the wine business.

The proposed private placement is expected to be completed by the first quarter of 2021.

Shares in Lambo closed unchanged at 3.5 sen, valuing the group at RM135.64 million. It saw some 9.01 million shares change hands.

Kathy Fong